BIOECON

BIOECON News

Issue no. 11 - Autumn 2014

 

Contents

 

BIOECON 2014: Conference outputs


Ben Groom (LSE) and Andreas Kontoleon (Cambridge Land Economy) co-hosted the 16th annual BioEcon conference on the economics of biodiversity conservation last 22-23 September 2014. The conference was held at the majestic buildings of King's College Cambridge and was attended by over 140 delegates from academia and the policy world. The conference provided the opportunity to exchange information on the latest developments on the economics of biodiversity and conservation. This year's keynote speakers were Professor Christian Gollier (Toulouse School of Economics) and Professor James Salzman (Duke University). The conference contained parallel presentations and special policy sessions were held on "Climate Change and Ecosystem Services" and "Natural Capital Accounting, Biodiversity and Ecosystems".
BIOECON was generously funded by UNEP, The Graduate Institute in Geneva, FEEM, The Grantham Research Institute (LSE), IUCN, CSIRO and IIED.

BIOECON organising committee planned the first ever UNEP pre-conference training workshop on "Building Biodiversity and Ecosystem Services into National Policy" for civil servants from developing countries. Over 400 applications were received. The workshop was attended by over 100 delegates primarily from the developing world whilst the training seminars were provided by BIOECON scientific partners .

A series of six videos on the seminars held are now available.

>> Click here to access the videos


 

Guest article
US Environmental Legislation and Biodiversity over the 20th Century

by Brooks Kaiser, University of Southern Denmark


Overview
The U.S. Endangered Species Act is held up both as an example of strict legislation working to guard biodiversity preservation (Yaffee, 1982) and an uneconomical law that creates perverse incentives that may actually reduce such preservation (Brown and Shogren, 1998; Lueck & Michael, 2003; List et al, 2006). Passage of the 1973 act itself, and that of the three earlier acts leading up to it in the 1960s, was not controversial; few congressmen wanted to vote against the preservation of endangered species! Yet controversy surrounding the law's restrictions on land and resource use extends far back throughout the development of the United States over the 20th century and continues into the present. We trace this evolution of federal political action to ask how the evolution of U.S. wildlife legislation reflects the tradeoffs between environment and development in spatial and temporal contexts.

Evolution of Wildlife legislation
We find three intertwined ambitions that drove federal legislation over wildlife and biodiversity at the beginning of the 20th Century: Establishment of Multiple Use Federal Lands, the Economic Development of Natural Resources, and the Maintenance of Option Values.

Establishment of Multiple Use Federal Land: The intentional and rapid private settlement of vast public land was slowing by the end of the 19th century, and the remaining lands, primarily forests, grazing lands, steep mountainous regions and deserts, lent themselves to multiple uses, including sub-surface resource extraction. The Organic Act of 1897 set aside lands to create the U.S. Forest Reserves, with the express multiple-use mandate to preserve timber supply and water supply. This legislation sets the U.S. on a path of public land management and use that today means about a third of U.S. territory is federal public land.
With so much public land, increasing opportunity costs for preservation are not just due to increasing values for biodiversity due to scarcity, but also due to the lower marginal returns on resource development and use. In the depressed 1930s, many dam projects received federal authorization, and the most economical of these were constructed quickly. Many others, however, were authorized but funding lagged due to low expected economic returns. These included such projects as the Trinity Dam (CA), authorized in 1931 but only constructed in 1955, with controversy over native salmon fishery rights, and the Tellico Dam (TN), authorized in 1937 and completed in 1979, after a 1978 vote exempting the dam from the Endangered Species Act. The even riskier Animas La Plata dam (CO) was authorized in 1956 and only recently finalized construction, after, inter alia, a 1997 vote over how much water must remain for endangered fish. Each of these three dams not only has low expected direct economic benefits, they each bump up against environmental concerns pertaining to habitat transformation. These conflicts resulted in the need for federal votes to determine the path forward.

Economic Development of Natural Resources: The Organic Act's requirements were intended to preserve resources in use, but in so doing, set aside the national lands that would naturally work to preserve ecosystems over time as well. At the same time, the Lacey Act of 1900 more directly targeted preservation of economically profitable activities by restricting hunting access to migratory game species and prohibiting inter-state trade in migratory species. Economic development was ostensibly the rationale behind each dam project, and the desire to gut the ESA expressed in a 2005 house vote on ESA reform.

Maintenance of Option Values: By the beginning of the 20th century, species extinctions were visible and economically damaging, including the loss of the Passenger Pigeon for the millinery trade. Additionally, species invasions such as the introduction and spread of the English Sparrow were noted as causing economic losses. Direct conservation was an appreciated goal, as shown by passage of the Lacey Act and creation of the National Park System, though not all conservation was treated equally. While the high biological diversity and uniqueness of the Everglades was appreciated, for example, and the idea for a national park was authorized in 1916, it took until 1934, and a federal vote to fund the Everglades National Park, to secure funding.

Analysis Overview
We investigate the 8 legislative votes mentioned above to capture the evolution of federal decision-making for the preservation of wildlife and biodiversity when opportunity costs are high. To control for ideology, we use Poole and Rosenthal's first dimension coordinates for the Congressional voters (www.voteview.com). We are thus able to focus on economic conditions that affect biodiversity preservation historically and today. We use the amount of Critical Habitat designated for preservation under the ESA, the percentage of federal land, water, and the number of listed species with Critical Habitat designations, and measures of high education, youth, urbanization, and government employment as potential explanatory variables. The number of dams in the district at the time of the vote is also included. Table 1 summarizes key results of the analysis.

Table 1: Direction of influence of characteristics of congressional districts on pro-environmental legislative votes

 

1900s

1930s

1950s

1970s

1990s on

Conservative Ideology

Strongly positive

Strongly negative

Conflicting

Strongly negative

Strongly negative

More Education

Conflicting

Strongly negative

Conflicting

Weakly negative

Weakly negative

Younger

Strongly positive

No effect

Positive

Negative

Weakly positive

More Urbanization

No effect

No effect

Conflicting

No effect

No effect

More Government Employment

NA

NA

Strongly negative

Strongly negative

Negative

More water area

Weakly conflicting

Weakly negative

Positive

Strongly positive

Positive

More federal land

Weakly negative

Positive

Negative

Strongly negative

Weakly negative

More Threatened
or Endangered Species

NA

Weakly positive

Weakly negative

Weakly positive

Weakly negative

More Critical Habitat

Strongly positive

Weakly positive

Weakly negative

Positive

Weakly positive

Dams

No effect

No effect

No effect

Positive

Negative

 

We discuss via maps. In Figure 1, one can see the evolution of the country's choices about environmental legislation. At the turn of the century, much of the land that would remain in the public domain over the century, becoming the most likely to be set aside for biodiversity conservation, either had no vote or chose abstention. One sees over time a shrinking of the congressional district size that casts the 'pro-conservation' vote; smaller districts are more urbanized and the costs of conservation are expected to be less burdensome. Option values to develop the land and natural resources matter. At the turn of the century, however, the direct use of the timber and game resources drives the conservation actions, and so the pro-environment vote captures this desire to maintain the resource base for the uses it had at the time. This is also true in the 1930s. From the 1950s, however, the option value of the conservation has shifted relative to other development goals for the regions.

Figure 1: Voting patterns for environment and conservation over time.

fig_1

 

These shifts are particularly telling when one compares Figure 2 to Figure 1. Figure 2 shows the ideological spread of the Congress over time. Today, the conservative ideology matches with the pro-development vote at the cost of the environment, and we have come to assume this correlation. At the beginning of the 20th century, however, the relationship is flipped: more conservative districts were more likely to vote for the conservation acts.


Figure 2: Ideology of the U.S. Congress House of Representatives over time.

fig_2

Conclusions
Conflicts in conservation versus the current use (depletion) of a resource that need to be resolved at the federal level, even when they are seemingly localized projects, are complicated by economic expectations and spatially distributed resources. Particularly, evolution in the disparate interests of youth versus age can be seen in these results, where youth seems to take a longer run view starting in the 1930s, while earlier they may have been more interested in resource extraction to make their way in the changing American landscape. High income-education interests seem to also switch in the early middle part of the century, from direct resource use to broader conservation. This gives support for conservation as a luxury good.

The longer the delay in implementation of an action, the more significant the problems with local Threatened and Endangered Species seem to be, or the greater the direct wildlife and public good conflicts. This is true for both the Everglades and the Dam projects – the delays in park formation and expenditures worsen the environmental conditions and increase the need for restoration while the delays in the dams increase the benefits of the downstream resources that would be affected by the dams and increase the consequences of degradation.

At the same time, an east-west divide seems to be growing, that is underlain by disparate resource endowments and ownership of common resources. The more of a district that is federal land, the generally lower is the vote probability for the environment, with the exception of the Everglades creation. The relationship to actual critical habitat and TES is more mixed.

Conservation is not an inherently liberal issue. Across the century, there is an evolution from conservation for 'direct use' to conservation for indirect and passive use values. Ideology is not everything; local economic considerations add explanatory power. Local concerns do appear to outweigh considerations of global benefits when Congressmen go to cast their votes. This finding strengthens the claims of the government for the need for federal intervention in wildlife law and biodiversity conservation that began, officially, with the Lacey Act. The ESA is encumbered by political and economic challenges from multiple directions that range from competing management goals for the many government agencies overseeing its implementation to the lack of concrete scientific data to ideology that favors conservative interpretations of federal intervention capabilities. Meanwhile the evolution of the Lacey Act has come to encompass almost every avenue of biodiversity, including threats from introduced pathogens. It is perhaps this law that carries much of the weight of biodiversity conservation in the United States.

References

 

BIOECON News


dot From Norwegian University of Science and Technology - NTNU

New Project
Economy and conflicts in grazing systems in northern latitudes: Loss to carnivores in reindeer herding and sheep farming
in cooperation with Trondheim Business School

This project focuses on conflicts in two different grazing systems in Norway, reindeer herding and sheep farming. Reindeer depend on common property pastures for grazing, and the major herding areas are characterized by internal competition, high animal densities, and food shortages during the winter. Also sheep farming relies on common pastures, but these are not subject to competition and overgrazing. Both systems are, however, vulnerable to predators. In reindeer herding, ecological studies suggest that losses to predators are compensatory to food shortages, whereas this is not the case for sheep farming. In the existing compensation scheme, compensation is paid for loss that can be documented caused by predators. There are several problems related to this scheme: It gives incentives to overstate losses, it gives no incentives to incentives to prevent losses, and the transaction costs are high. This project will analyze alternative compensation schemes, such as a risk-based compensation where owners are compensated for the risk of being exposed to predators instead of losses. In particular, the project will focus on how different compensation schemes affect the incentives to prevent losses and whether the optimal compensation schemes differ between systems of compensatory losses and additive losses. The project will also capture the interaction between compensations schemes, animal densities, and overgrazing. The project will produce bio-economic age-structured models capturing the relationship between losses to predators and food shortages, and game theoretical models capturing the cooperative behavior of owners.

For more information contact Prof. Anders Skonhoft

Book
Naturressursenes Økonomi (The Economics of Natural Resources)
O. Flåten and A. Skonhoft (eds), Gyldendal, 2014

Norway is a rich country - much thanks to abundant natural resources and good management. This book analyses the use and management of natural resources in an economic perspective. The aim is to provide knowledge about the Norwegian resources and the economy and the institutions of the natural resource-based industries, and - not least - to provide the necessary theoretical basis for economic analysis of utilization and management of natural resources. The target audience is university and college students, policy makers and analysts. The book starts with two chapters on the importance of natural resource wealth for the Norwegian economy. Then it considers renewable natural resources such as fish, forest and ecosystem services, and the renewable natural resources hydropower, aquaculture and agriculture. The book concludes with two chapters on the non- renewable resources of oil and gas and minerals.

Book info

 

dot From UNIVERSITY OF HAIFA - NRERC

Workshop
The Israeli Mediterranean shores and their economic valuation

The workshop "The Israeli Mediterranean: The Management Aspect" was held at Haifa University on 14.9.14. The workshop was devoted to the exploration of different economical and regulatory issues concerning the future exploitation and management of Israeli Mediterranean waters. These issues included the effort to valuate different ecosystem services and how to incorporate them into national accounts. Two examples of valuations were given, the first was for the climate regulation ecosystem service and the other dealt with the economic disservice resulting from invasive species. Other issues that were discussed included the difficulties and possible ways to deal with inherent uncertainty and lack of data essential for management, planning issues with an emphasis on coast-sea relations and obstacles related to the existence of a highly complicated environment comprised of multiple stakeholders with conflicting interests.


Working paper
An Economic Analysis of Ecosystem Services under Different Fertilizing Regimes in Agroecosystems
Yoav Peled, Shiri Shamir, Avraham Haim

Throughout the world, intensive and high input agricultural production methods are widely practiced, quite often at the expense of existing biodiversity and various benefits originating from the landscape. By addressing agricultural systems as managed ecosystems and using the ecosystem services approach, sustainable strategies can be developed, maximizing landholders and other affected stakeholders' welfare. The authors of this paper assess the environmental and economic impact of organic fertilizer as an agricultural management tool on three ecosystem services derived from agroecosystems: food provisioning, climate regulation and groundwater pollution prevention. Using the ecosystem services approach, the potential supply of these services is evaluated for various crops in Israel. The results indicate that under organic fertilization, food provisioning is lower than under conventional fertilization, while the potential of supplying climate regulation and groundwater pollution prevention, increases. Economically, however, this transition results in welfare reduction for farmers for most examined crops, negating the possibility of achieving more environmentally friendly production methods. An examination of consumers' willingness to pay for organically fertilized produce reveals that, for most crops, the majority of surveyed consumers are able to compensate for farmers' loss of welfare.

Download the paper

 

dot From Universite' CATHOLIQUE DE LOUVAIN

Journal Article
The use of agrobiodiversity for plant improvement and the intellectual property paradigm: institutional fit and legal tools for mass selection, conventional and molecular plant breeding

by Fulya Batur and Tom Dedeurwaerdere

Focused on the impact of stringent intellectual property mechanisms over the uses of plant agricultural biodiversity in crop improvement, the article delves into a systematic analysis of the relationship between institutional paradigms and their technological contexts of application, identified as mass selection, controlled hybridisation, molecular breeding tools and transgenics. While the strong property paradigm has proven effective in the context of major leaps forward in genetic engineering, it faces a systematic breakdown when extended to mass selection, where innovation often displays a collective nature. However, it also creates partial blockages in those innovation schemes rested between on-farm observation and genetic modification, i.e. conventional plant breeding and upstream molecular biology research tools. Neither overly strong intellectual property rights, nor the absence of well delineated protection have proven an optimal fit for these two intermediary socio-technological systems of cumulative incremental innovation. To address these challenges, the authors look at appropriate institutional alternatives which can create effective incentives for in situ agrobiodiversity conservation and the equitable distribution of technologies in plant improvement, using the flexibilities of the TRIPS Agreement, the liability rules set forth in patents or plant variety rights themselves (in the form of farmers', breeders' and research exceptions), and other ad hoc reward regimes.

Read the open access article

Journal Article
A pragmatist approach to transdisciplinarity in sustainability research: From complex systems theory to reflexive science
Florin Popa, Mathieu Guillermin, Tom Dedeurwaerdere

The importance of questioning the values, background assumptions, and normative orientations shaping sustainability research has been increasingly acknowledged, particularly in the context of transdisciplinary research, which aims to integrate knowledge from various scientific and societal bodies of knowledge. Nonetheless, the concept of reflexivity underlying transdisciplinary research is not sufficiently clarified and, as a result, is hardly able to support the development of social learning and social experimentation processes needed to support sustainability transitions. In particular, the concept of reflexivity is often restricted to building social legitimacy for the results of a new kind of 'complex systems science', with little consideration of the role of non-scientific expertise and social innovators in the design of the research practice itself. The key hypothesis of the paper is that transdisciplinary research would benefit from adopting a pragmatist approach to reflexivity. Such an approach relates reflexivity to collective processes of problem framing and problem solving through joint experimentation and social learning that directly involve the scientific and extra-scientific expertise. To test this hypothesis, the paper proposes a framework for analysing the different types of reflexive processes that play role in transdisciplinary research. The main conclusion of the analysis is the need to combine conventional consensus-oriented deliberative approaches to reflexivity with more open-ended, action-oriented transformative approaches.

Read the open access article

 

dot From fondazione eni enrico mattei - FEEM

Working Paper
The Passive Use Value of the Mediterranean Forest
Vladimir Otrachshenko

In this study we estimate the passive use value of forest in different ecological zones in the Mediterranean region. We estimate these values for forests using meta-analysis. These estimates are used to reveal the annual monetary values per hectare for each country. The total annual amount of passive use value of the Mediterranean forest is about one billion international dollars. The estimated passive use value of the forest from this study can be used to account for the social welfare loss caused by fire, insects, diseases, biotic agents, and abiotic factors.


 

About the BIOECON Newsletter

The BIOECON Newsletter is prepared with the contribution of all the BIOECON Partner Institutions. Please send comments and questions to: silvia.bertolin@feem.it.
The BIOECON Newsletter is a six-month publication. Next issue: Spring 2015


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