Biodiversity Economics: Principles, Methods and Applications

Half-title......Page 3
Title......Page 5
Copyright......Page 6
Contents......Page 7
Figures......Page 11
Tables......Page 14
Contributors......Page 18
Preface......Page 22
Acknowledgements......Page 24
Foreword......Page 26
2 The causes of biodiversity loss......Page 29
Habitat conversion......Page 30
Trade......Page 32
Invasives......Page 33
3 The value of biodiversity......Page 35
Concepts......Page 36
Techniques......Page 38
4 Policies for biodiversity conservation......Page 41
The role of voluntary agreements and contracts......Page 42
Conservation policy: implementation......Page 44
5 Managing agricultural biodiversity: causes,
values and policies......Page 47
6 Conclusion to the volume......Page 49
1 Introduction: the issue......Page 50
2 A diagrammatic construct......Page 52
3.2 The extinction record......Page 56
3.3 ‘Underfunding’......Page 57
4.2 The property rights argument......Page 58
4.3 Cornucopians......Page 59
4.4 The growth of protected areas......Page 60
5.1 The cost-benefit evidence: protected areas......Page 62
5.2.1 Protected area costs......Page 66
5.2.2 Debt-for-nature swaps......Page 67
5.2.3 The GEF......Page 68
5.2.4 Bilateral assistance......Page 71
6 Acurious literature: the value of everything......Page 72
7 Conclusions: what have we learned?......Page 77
References......Page 79
Part I Causes of biodiversity loss......Page 83
Section A Land conversion......Page 85
1 Introduction......Page 87
2 Institutional constraints and forest conversion......Page 89
3 A pure open access model of land conversion......Page 90
4 Institutional constraints and land conversion......Page 93
5 Agricultural land expansion in pre-NAFTA Mexico......Page 96
6 Shrimp farm expansion and mangrove loss in Thailand......Page 101
References......Page 114
1 Introduction......Page 120
2 Amodel of interactions in deforestation......Page 123
3 Estimation strategy......Page 126
3.2 Instrumental variable approach......Page 127
3.3 Discreteness and the Two Stage Probit Least Squares......Page 128
4 Data requirements and GIS......Page 129
4.2 Neighbourhood deforestation......Page 130
4.3 Observable drivers of deforestation......Page 131
4.4 Instrumenting neighbourhood deforestation......Page 133
5 Results and equilibria......Page 134
6 Conclusion......Page 137
References......Page 138
1 Introduction......Page 143
2 Ecological setup......Page 145
3 Known events......Page 146
4 Endogenous events......Page 149
5 Exogenous events......Page 153
6 Concluding comments......Page 156
References......Page 157
Section B Invasives......Page 159
1 Introduction......Page 161
2 Poverty and environmental change......Page 163
3 Trade and invasive species......Page 168
4 Estimates of the damage costs of invasive species......Page 173
5 Invasion externalities: economic instruments of IAS
control in poor countries......Page 179
6 Public investment in invasive species control
in low-income countries......Page 183
7 Factoring poverty into predictive modelling
and management......Page 184
References......Page 187
1 Introduction......Page 194
2 Discrete dynamic endogenous risk framework......Page 195
Discounting......Page 201
Risk aversion......Page 203
4.1 Empirical model......Page 206
4.2 Results......Page 212
5 Conclusions......Page 225
References......Page 226
Section C International trade......Page 229
1 Introduction......Page 231
2 Benchmark 1: optimal management and perfect
property rights......Page 236
2.1 Single-market bio-economic model......Page 237
2.2 Adding opportunity costs of habitat......Page 239
2.3 The 2 × 2 small open economy......Page 240
3.1 Single-market bio-economic model......Page 243
3.2 The 2 × 2 small open economy......Page 246
4 Trade between North and South......Page 251
4.1 North-South: trade between polar opposite extremes......Page 252
4.2 Imperfect property rights in North and South......Page 254
5 Endogenous institutions and property rights regimes......Page 258
5.1 Enforcement, profits and welfare......Page 259
5.2 Trade and common pool management......Page 261
5.3 Trade and corruption......Page 264
6 Conclusions......Page 266
Refereces......Page 270
1 Introduction......Page 274
2.1 Production technologies......Page 277
2.2 Preferences......Page 278
2.4 Utility maximisation......Page 280
2.5 Autarkic equilibrium......Page 281
2.6 General equilibrium under free trade......Page 284
3.1 From autarky to free trade......Page 286
3.2 The impact of positive environmental sensitiveness of
Southern consumers......Page 287
3.3 The impact of biodiversity loss on the terms of trade......Page 288
4 Consumer heterogeneity in the North......Page 289
5 Impact of population growth on biodiversity......Page 291
6 Impact of technology subsidies on biodiversity loss......Page 293
7 Policy implications and conclusion......Page 294
References......Page 295
Part II The value of biodiversity......Page 297
Section A Concepts......Page 299
1 Introduction......Page 301
2.1 The approach......Page 304
3.1 The production function approach: the value of past searches......Page 307
3.2 Search-theoretic approach......Page 309
3.3 Limitations and problems of the search-theoretic approach......Page 311
4.1 Evolutionary processes of natural selection......Page 313
4.2 Real options......Page 315
5 Conclusion......Page 317
References......Page 319
1 Introduction......Page 321
2 Biodiversity as an economic good......Page 322
3.1 Focus: species and ecosystems......Page 323
3.2 The basic index: species richness......Page 325
3.3 Indices based on relative abundances......Page 326
3.4 Indices based on characteristic features......Page 328
3.4.1 The Weitzman index......Page 329
3.4.2 The Nehring-Puppe index......Page 330
4.1 Conceptual comparison......Page 331
4.2 The relevance of abundances and features......Page 332
4.3 Different philosophical perspectives on diversity......Page 333
References......Page 335
Section B Techniques......Page 339
1 Introduction......Page 341
2.1 Feeding stations......Page 344
2.2 The value of wildlife viewing and protecting......Page 345
2.3 Entrance fee analysis......Page 347
3 The study sites......Page 348
4.1.1 Calculating TCM......Page 349
4.1.2 Calculating the value of viewing vultures......Page 350
4.2 CVM......Page 351
4.2.1 CVM results......Page 353
5.1 Costs of feeding stations......Page 360
5.3 Some policy implications of valuation techniques......Page 361
5.3.1 Revenue estimation......Page 362
5.3.2 Species–visitors interaction......Page 363
6 Policy and conclusions......Page 367
References......Page 368
1 Introduction – the challenge of valuing biodiversity......Page 371
2.1 Defining biodiversity......Page 373
2.2 Are all species equal?......Page 374
2.3 Do certain species contribute more than others to the biodiversity
of an area?......Page 375
3.1.1 Genetic diversity......Page 377
3.1.4 Ecosystem functions and services......Page 379
3.2 The economic value of biological concepts......Page 380
4.1 What aspects of biodiversity are important to people?......Page 381
4.2 An innovative approach to presenting complex information
in choice experiments......Page 383
4.3 The choice task......Page 386
5 Results......Page 387
6 Discussion......Page 390
7 Conclusions......Page 392
References......Page 393
1 Introduction......Page 397
2.1 The choice experiment method......Page 399
2.2 Study area and data collection......Page 401
2.3 Survey instrument......Page 402
3.1 Choice experiment results......Page 405
3.2 Economic welfare impacts of changing management
at the different sites......Page 407
3.3 Further comparison of management scenarios......Page 409
4 Conclusions......Page 410
References......Page 411
Part III Policies for biodiversity conservation......Page 413
Section A Contracts......Page 415
1 Introduction......Page 417
2.1 The problem of habitat loss on private land......Page 418
2.2.1 Australia......Page 419
2.2.2 International experiences......Page 420
3.1 Missing markets......Page 421
3.2.2 Single round......Page 423
3.2.3 Discriminative price......Page 424
3.3 Contract design......Page 425
3.4.1 Biodiversity significance......Page 427
4 Results......Page 428
4.1 Analysis of bids......Page 430
4.2 Improvements in habitat quality and quantity......Page 432
5 Discussion and conclusions......Page 433
5.1.2 Multiple environmental outcomes......Page 435
5.1.4 Reserve prices and demand valuation......Page 436
5.1.6 Information to facilitate cross-programme comparisons......Page 437
References......Page 438
Modelling......Page 440
1 Introduction......Page 445
2 From a static to a dynamic IPR framework
in access and benefit sharing contracts......Page 449
3 The Kani model of benefit sharing (KMBS):
An institutional fitness analysis......Page 455
4 Valuing the bioresource from the TK holders’ perspective......Page 460
5 Conclusion......Page 467
References......Page 469
1 Introduction......Page 474
2.1 A general framework for landscape modelling......Page 477
2.2 Mathematical representation of farm-land use, landscape
planning and ecology......Page 479
2.3 Ecological aspects......Page 480
2.4 Scaling aspects and organisational matters......Page 482
3 Land use modelling at farm level......Page 483
3.1 Given tools for modelling and farmers’ objectives......Page 484
3.2 New tools for economic land use modelling......Page 485
3.3 Background for a mathematical solution......Page 488
4 Compensation payments, financial costs and scenarios......Page 489
5.1 Farm objectives and scaling......Page 491
5.2 Landscape level planning......Page 492
6 Aprincipal-agent approach to the provision
of nature elements......Page 493
7 Summary......Page 495
References......Page 496
Appendix 1: Agent behavioural functions and profits......Page 498
A2.1 Farm objectives, landscapes and agent description......Page 501
A2.2 Agent behaviour......Page 502
A2.3 Government as principal and its objective function......Page 503
Section B Implementation......Page 507
1 Introduction......Page 509
2.1 On the efficient design of enforcement of conservation rules......Page 512
2.2 Institutional crowding out......Page 515
3 Self-regulation and common pool management......Page 518
3.1 Peer sanctioning......Page 519
3.2 Peer rewards and selective exclusion......Page 521
3.3 Ostracism......Page 524
4 Conclusions......Page 525
References......Page 526
1 Introduction......Page 529
2.1 The biological model......Page 531
2.2 The economic model......Page 534
3 Optimisation problem and heuristic solution methods......Page 536
4.1 Biological model......Page 537
4.2 Economic model......Page 538
4.3 The landscape......Page 540
4.4 Simulation experiments......Page 541
5.1 Base case......Page 542
5.3 Sensitivity analyses......Page 543
6 Discussion......Page 544
References......Page 547
1 Introduction......Page 559
2 The tradeoff between wildlife conservation and
economic utilisation......Page 561
3 A model of balancing recreation and wildlife conservation......Page 562
4.1 The solutions of the optimal control model......Page 566
4.2 Properties of the bio-economic equilibrium......Page 568
4.3 Equivalence of the ecosystem and the flagship approach......Page 569
5 A case study of the golden eagle in the eastern Alps......Page 571
5.1 Assigning parameters to the model for the golden eagle in Austria......Page 572
5.2 Specifying the welfare functions for the flagship and
the ecosystem approaches......Page 573
5.3 Optimal visitor control strategies for the flagship and
the ecosystem approaches......Page 574
6 Conclusions......Page 577
References......Page 579
A.2 The canonical system......Page 582
A.3 Equilibrium properties......Page 583
1 Introduction......Page 585
2 Ecological interaction and the various cost and
benefit streams......Page 588
3.1 The case of negligible ecological interaction......Page 592
3.2 The case of a fixed shadow price of the recolonised species together
with negligible interaction with the existing species......Page 593
3.3 The case of ecological interaction without harvesting benefit
of the recolonised species......Page 594
3.4 The case of ecological interaction without harvesting benefit of the
recolonised species and with a constant harvesting value of the
existing species......Page 595
4 The recolonisation of the Scandinavian wolf......Page 596
5 Conclusion......Page 603
References......Page 604
Part IV Managing agro-biodiversity: causes, values and policies......Page 607
1 Introduction......Page 609
2 Analysis......Page 611
3 Econometric estimation......Page 612
4 Empirical analysis......Page 613
4.1 Wheat and crop biodiversity in Sicily......Page 614
4.2 Database and econometric specification......Page 615
5 Econometric results......Page 616
6 Conclusion......Page 618
References......Page 619
1 Introduction......Page 622
2 Rationale for data enrichment by combining revealed
and stated preference data......Page 625
3 Data collection......Page 627
3.1 Choice experiment data......Page 629
3.2 Farm household data......Page 632
4 Theoretical framework......Page 633
5 Econometric analysis......Page 634
5.1 Separate estimation of revealed and stated preference data......Page 635
5.2 Joint estimation of revealed and stated preference data......Page 638
5.3 Welfare measures of agro-biodiversity management
in the home garden......Page 641
References......Page 645
1 Introduction......Page 651
2 Crop genetic diversity: economic methods, findings
and limitations......Page 653
2.1 What is the marginal value of a plant species or crop
genetic resources?......Page 654
2.3 What is the effect of crop biodiversity on productivity,
vulnerability and efficiency?......Page 656
2.4 What are the costs and benefits of ex-situ conservation?......Page 657
2.5 Which factors predict variation in crop biodiversity on farms as
economies change? Which farmers are most likely to maintain it?......Page 658
2.6 What is the value of crop genetic resources to farmers?......Page 661
3 Livestock genetic diversity: economic methods, findings
and limitations......Page 662
3.1 What is the value of livestock genetic resources to farmers?......Page 663
3.2 What are the costs and benefits of conservation?......Page 664
3.3 Which farmers should be targeted for participating in in-situ breed
conservation programmes? Which farmers are most likely to
maintain indigenous breeds?......Page 667
3.4 Which traits should be addressed in breeding programmes?......Page 668
3.5 How do specific policies influence GR conservation and sustainable
use? How can conservation strategies be made cost-efficient? Which
breeds should be priorities for conservation?......Page 669
4 Conclusions......Page 671
References......Page 672
Index......Page 677