Applied EcoCommerce – Expanding the Economy with Ecological Value

In EcoCommerce, “Farmer Kimball” relies on three primary income streams; commodities, biomass and ecoservices. These values are generated by applying land management strategies that produces these ecoservices in the quantity that is desired.

The unique challenge for EcoCommerce formalizing ecoservices within the economic system. This challenge was described by Dr. Bob A. Stewart, West Texas A&M University Professor of Soil Science at a University of Minnesota, April 2008, lecture on emerging issues in soil and water. He was asked if either policy reforms or the market will provide farmers the support to reduce resource degradation. Dr. Stewart replied by stating that many farmers in his region are “burning up the soil” and using ground water at a rate that is greater than the rate of recharge. He added, “But these farmers are making rational economic decisions. If they did not make these decisions and in turn were no longer competitive in the marketplace and lost their ability to economically sustain themselves, they would be making irrational decisions.” He concluded by saying that whether it is by the hand of policy or the hand of the market place that provides the support for farmers to make rational decisions that improve resources, is not an answer that could be provided by him but must be answered by society.

For society to answer these questions, the society must be able to engage within the decision-making framework. The EcoCommerce framework allows the value of ecoservice to be formalized within traditional economic activities and processes. The economic participants are given the responsibility to define a level of sustainability, rather than allocating that role to a government agency. This is accomplished by posting resource indices, ecoservice units, prices, and transactions in a manner that is transparent and assessable, similar to commodity price units and postings. Unlike traditional economic components, ecoservices are public goods whose benefits can be used by many. This attribute that has been a hindrance to the development of ecoservice markets is actually an advantage to EcoCommerce. With the use of indices to measure resource-management levels, a so-called Sustainability 1 .0 level can be achieved through a shared responsibility of many industries, governments, non-profit organizations, retail outlets, and consumers. This process of sharing costs and values becomes the flip side of the “tragedy of the commons” coin and generating ecoservices becomes the “opportunity of the commons.”

Participants that engage in EcoCommerce do not require a complete understanding of EcoCommerce any more than engaging in an economic system requires complete knowledge of economics. The vast majority of EcoCommerce participants will be able to engage in EcoCommerce through understanding how their self-interests can be met. As long as the cost of obtaining market knowledge and the cost of market entry are less than the ecoservice benefits, participants will enter the market and trades will ensue.