BIODIVERSITY CONSERVATION

Ecology, Economy & Environment

VOLUME 4

The titles published in this series are listed at the end of this volume.

BIODIVERSITY CONSERVATION Problems and Policies

Papers from the Biodiversity Programme Beijer International Institute of Ecological Economics Royal Swedish Academy of Sciences

edited by

C. A. Perrings University of York, Heslington, York, U.K.

K.-G. Maler Stockholm School of Economics and Beijer Institute, Sweden

C. Folke Stockholm University and Beijer Institute, Sweden

C. S. Holling University of Florida, U.S.A.

and

B.-O. Jansson Stockholm University and Stockholm Centre for Marine Research, Sweden

SPRINGER SCIENCE+BUSINESS MEDIA, B.V.

A CLP. Catalogue record for this book is available from the Library of Congress.

ISBN 978-94-010-4437-0 ISBN 978-94-011-1006-8 (eBook)

DOI 10.1007/978-94-011-1006-8

Printed on acid-free paper

All Rights Reserved © 1994 Springer Science+Business Media Dordrecht Originally published by Kluwer Academic Publishers in 1994 Softcover reprint of the hardcover 1st edition 1994 No part of the material protected by this copyright notice may be reproduced or utilized in any form or by any means, electronic or mechanical, including photocopying, recording or by any information storage and retrieval system, without written permission from the copyright owner.

CONTENTS Tables Figures Abbreviations Authors Preface

PART 1

Chapter 1

Chapter 2

PART 2:

Chapter 3

Chapter 4

Chapter 5

Chapter 6

FRAMING THE PROBLEM

Biodiversity conservation and economic development: the policy problem c.A. Perrings, K.G. Maler, c. Falke, C.S. Holling and B.o. Jansson

Biodiversity conservation and economic development: local and global dimensions D. W. Pearce and c.A. Perrings

UNDERSTANDING BIODIVERSITY CHANGE

Population extinction and the biodiversity crisis Gretchen C. Daily and Paul R. Ehrlich

Diversity conservation in relation to fisheries in the Baltic Sea Monica Hammer

Rangeland ecology: managing change in biodiversity B.H. Walker

Biodiversity, natural resource accounting and environmental monitoring M.S. Common and T. W. Norton

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3

22

43

54

65

82

PART 3: THE VALUATION OF BIODIVERSITY

Chapter 7

Chapter 8

Modeling the value of biodiversity using a production function approach Urvashi Narain and Anthony Fisher

Valuation of a marine resource John Dixon, Louise Scura and Tom v'ant Hof

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120

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Chapter 9

Chapter 10

PART 4:

Chapter 11

Chapter 12

Chapter 13

Chapter 14

PART 5:

Chapter 15

Chapter 16

Chapter 17

Chapter 18

References Index

Tropical wetland values and environmental functions Edward B. Barbier

Valuation and the management of biological diversity Mohan Munasinghe

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162

THE IMPACT OF ECONOMIC POLICY

Environmental impact of governmental policies and external shocks in Botswana: A computable general equilibrium model approach Lena Unemo

A dynamic CGE model of deforestation in Costa Rica Annilm B. Persson

The timber trade as a cause of tropical deforestation. Joanne C. Burgess

Sustainable use of tropical forests in South-East Asia Theodore Panayotou and Peter S. Ashton

OPTIONS AND PRIORITIES FOR BIODIVERSITY CONSERVATION

Traditional ecological knowledge, biodiversity, resilience and sustainability Fikret Berkes. Carl Folke and Mahdav Gadgil

Conservation of biodiversity and economic development: the concept of transferable development rights Theodore Panayatou

Biodiversity conservation and local development aspirations: new priorities for the 1990s Michael P. Wells

Unresolved issues c.A. Perrings. K.G. Miiler. C. Folke. C.S. Holling and B.O. Jansson

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226

245

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321

329 378

TABLES

2.1 Returns to development uses 30 2.2 Comparative rates of return to land use in Botswana 31 6.1 Valuation and PNDP measurement 94 7.1 Model results 115 S.l Revenues and costs associated with the Bonaire Marine Park (1991) 129 9.1 Causes of wetland loss 141 9.2 Major threats to wetlands: Asia, Latin America and the Caribbean 142 9.3 General, ecological and economic system characteristics 143 9.4 Comparison of present value net economic benefits Kano River Project

Phase I and Hadejia-Jama'are Floodplain 148 10.1 Environmental functions of forests 155 10.2 Land use information for villages 170 10.3 Value of forest products collected by villages 171 10.4 Summary statistics for complete sample of tourists 171 10.S Summary statistics for tourists by country of origin 172 10.6 Summary of economic analysis of Mantadia national park 180 11.1 Sectoral elasticities 197 11.2 A fall in the price of diamonds: environmental and economic indicators 198 11.3 A deterioration of the terms of trade: environmental and economic

indicators 199 11.4 Lower import tariff on crop: environmental and economic indicators 200 11.S Quantity constraint on labour: environmental and economic indicators 201 12.1 The producing sectors and production factors 208 12.Al The aggregation of production sectors 221 12.A2 Costa Rica 1986: Base data 222 12.A3 Deforestation parameters and initial values 222 12.A4 Changes in interest rate 222 12.AS Capital 223 12.A6 Land 223 12.A7 Forestry 223 12.AS Agriculture 224 12.A9 Industry 225 13.1 Tropical forest resources: status and changes 228 13.2 Estimated rates of extinction based on tropical deforestation 229 13.3 World and tropical timber production and trade, 1990 231 13.4 Forest products trade balance and percentage of total trade in tropical

countries, 1990 232 13.Sa Production and trade in timber products by tropical countries, 1990 233 13.Sb Export of timber products as a percentage of production in tropical

countries 233 13.6 Timber harvesting and deforestation in Mrican ITTO producer countries,

1981-85 236 13.7a Sources of deforestation in tropical countries, 1981-90 237

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13.7h 13.8 13.9 13.10 13.11 14.1 14.2 14.3 14.4 14.5 14.6

14.7

Sectoral share in forest degradation and forest modification 237 The causes of deforestation in developing countries 1968-78 239 Estimated deforestation equation 240 Elasticity of forest depletion with respect to signiflCaIrt variables (1967-85) 242 The causes of deforestation in tropical countries 242 Long-term land use change 1900-80 247 Cropland and forest per capita 249 Wood production, Asian developing economies, 1975-1987 250 Estimated sustainable yield and wood harvest in 1980 251 Main sources of tropical deforestation 255 Causes of deforestation in Southeast Asia: a summary of statistical findings 257 Net present values of tropical forest extracts and services (dominant use only), selected countries 260

FIGURES

2.1 2.2 4.1 4.2 5.1 5.2

5.3 5.4 5.5

5.6

5.7

5.8

Private and social optima: continuous external cost function Local and global social optima: continuous external cost functions The Baltic Sea Fish catches in Sweclen's·fisheries 1913-1992 Generalised model of the determinantscof savanna structure Hypothetical distribution of savannatypes in relation to the main determinants of savannas Assumed relationship between stocking rate and range- condition Spatial patterning (patchiness) in semi-arid rangelands Dynamics of the proportional composition of unpalatable and palatable grasses in response to changes in grazing pressure The relation between annual rainfall and grass production on cleared and bushed plots on clay loam and sandy soils at Matopos in Zimbabwe Simulated changes in rainfall, pasture biomass, and density of red kangaroos at Kinchega National Park, New South Wales Simplified state-and-transition interpretation of semi-arid grassland! woodland in eastern Australia

33 34 56 59 67

68 70 72

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80 8.1 Bonaire 122 8.2 Relationship between coral cover, species diversity and stress 126 8.3 Diving intensity and threshold stress level 127 8.4 Willingness to pay for park management: Bonair Marine Park 133 8.5 Park management, diver education and threshold stress level 136 9 • 1 Valuing wetland benefits 144 9.2 Optimal extraction paths for wetland resources 155 1 0.1 Multicriteria analysis methodology 175 10.2 Biodiversity index value and reservoir size in Sri Lanka 178 1 0 • 3 Trade off between biodiversity and electricity supply 179 14.1 Deforestation as a function of cropland expansion: tropical and

subtropical Asia (1964-1985) 247 14. 2 Forest cover and population density: tropical and subtropical Asia 249 14.3 Population density and percent of land in forest cover for selected countries 253 14.4 Wildlife habitat: remaining habitat and protected area 254 15. 1 Remnant network of sacred trees and sacred groves presently existing in

an area of 25m2 on the Western Ghats -of Kamataka State in South India 274 15.2 15.3 15.4 15.5

15.6

15.7

16.1

Successional stages of the kebun-talim system (Java) Profile of a typical Javanese home garden (pekarangan) Bora agroforestry from the Peruvian Amazon Traditional Indonesian integrated rice-fish culture (subak) and inshore polyculture pond management (tambak) An example of the South Pacific 'integrated coporate estate' concept: The Maroro (Solomon Islands) puava , The concept model of the ancient Chinese ideal of 'living in harmony with Nature' Biodiversity protection: supply and demand

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276 277 278

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282

283 293

ABBREVIATIONS

AN BMC BMP CES CET CGE GCTE CVM DNA EAGDP EC FAO GDP GEF GNP ICDP IGBP lIED IK IMP ITTC ITTO IUCN

LDC LEEC LMTRS MCA MTF NGO NNP NPP ODA OD! OECD PAM PCC PNDP SAM SGDP SIDA SMS TAC IDR

Available Nutrients Botswana Meat Commission Bonaire Marine Park Constant Elasticity of Substitution Constant Elasticity of Transfonnation Computable General Equilibrium Global Change and Terrestrial Ecosystems Contingent Valuation Method Deoxyribonucleic acid Environmentally Adjusted Gross Domestic Product Environmental Cost Food and Agriculture Organisation Gross Domestic Product Global Environment Facility Gross National Product Integrated Conservation and Development Project International Geosphere and Biosphere Programme International Institute for Environment and Development Indigenous Knowledge International Monetary Fund International Tropical Timber Council International Tropical Timber Organisation International Union for the Conservation of Nature and Natural Resources (World Conservation Union) Less Developed Country London Environmental Economics Centre Long-Tenn Forest Management Research Sites Multi-Criteria Analysis Moist Tropical Forest Non-Governmental Organisation Net National Product Net Primary Product Overseas Development Administration Oversease Development Institute Organisation for Economic Cooperation and Development Plant Available Moisture Potential Carrying Capacity Proper Net Domestic Product Social Accounting Matrix Sustainable Gross Domestic Product Swedish International Development Authority Safe Minimum Standard Total Allowable Catch Transferable Development Right

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TEK TEV UNCED UNEP UNSO USAID USEPA WCED WRI WfA WTP WWF

Traditional Ecological Knowledge Total Economic Value United Nations Conference on Environment and Development United Nations Environment Programme United Nations Statistical Office United States Agency for International Development United States Environmental Protection Agency World Commission on Environment and development World Resources Institute Willingness to Accept Willingness to Pay World Wildlife Fund (Worldwide Fund for Nature)

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AUTHORS

Peter S. Ashton is a Faculty Fellow in the International Environment Program at the

Harvard Institute for International Development, Harvard University.

Edward B. Barbier is Senior Lecturer at the Department of Environmental Economics and

Environmental Management, University of York, and fonnerly Director ofthe London

Environmental Economics Centre of the International Institute for Environment and

Development.

Fikret Burkes is a specialist in common property resources and community-based resource

management at the Natural Resources Institute, University of Manitoba, Winnipeg.

Joanne C. Burgess is a lecturer at the Department of Environmental Economics and

Environmental Management, University of York and fonnerly a Research Associate at

the London Environmental Economics Centre, International Institute for Environment

and Development.

Gretchen Daily is WinslowfHeinz Postdoctoral Fellow at the Energy and Resources Group,

University of California, Berkeley, and Research Associate at the Center for

Conservation Biology, Stanford University.

John A. Dixon is an environmental economist in the Environment Department of the World

Bank and fonnerly in the Environment and Policy Institute, East-West Center,

Honolulu.

Paul R. Ehrlich is Bing Professor of Population Studies and President of the Center for

Conservation Biology, Department of Biological Sciences, Stanford University.

Anthony Fisher is Professor of Agricultural and Resource Economics at the University of

California, Berkeley.

Carl Folke is Deputy Director of the Beijer International Institute of Ecological Economics at

the Royal Swedish Academy of Sciences, and an Associate Professor at the Department

of Systems Ecology, Stockholm University.

Mahdav Gadgil is the Astra Professor of Biological Sciences at the Centre for Ecological

Sciences, Indian Institute of Science, Bangalore.

Monica Hammer is completing a PhD at the Department of Systems Ecology, Stockholm

University.

Buzz Holling is the Arthur R. Marshall Professor of Ecological Sciences at the Department

of Zoology, University of Florida, Gainesville.

Bengt-Owe Jansson is Professor of Marine Ecology in the Department of Systems

Ecology, Stockholm University, and Director of the Stockholm Centre for Marine

Research.

Karl-Goran Maler is Professor of Economics at the Stockholm School of Economics, and

Director of the Beijer International Institute of Ecological Economics at the Royal

Swedish Academy of Sciences. xii

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Mohan Munasinghe is Division Chief for Environmental Policy and Research at the World

Bank, Washington DC.

Urvashi Narain is completing a PhD at the department of Agricultural and Resource

Economics, University of California at Berkeley.

Theodore Panayotou is Director of the International Environment Program at the Harvard

Institute for International Development, Harvard University.

David Pearce is Professor of Environmental Economics at University College London, and a

director of the Centre for Social and Economic Research on the Global Environment

(CSERGE).

Charles Perrings is Professor of Environmental Economics and Environmental Management

at the University of York, and Director of the Beijer Institute's Biodiversity

Programme.

Annika Persson is an environmental economist at the Environment Department of the World

Bank.

Louise Fallon Scura, an independent consultant, is a resource economist specialising in

economic analysis of natural resource and environmental impacts, with Edward D.

Scura & Associates, Inc., based in Guatemala.

Lena Unemo is an environmental economist working with the Swedish International

Development Authority.

Tom van't HoC, is an independent consultant, specialising in coral reef ecology.

Michael Wells is an independent consultant specialising in the economic and policy aspects

of environmental conservation in developing countries working with the World Bank,

Asian Development Bank and the MacArthur Foundation's World Environment and

Resources Programme.

PREFACE

This volume is one of a number of publications to carry the results of the first research programme of the Royal Swedish Academy of Science's Beijer Institute. The Institute was formed in 1991 in order to promote interdisciplinary research between natural and social scientists on the interdependency between economic and ecological systems. In its first research programme, the Biodiversity Programme, the Institute brought together a number of leading economists and ecologists to address the theoretical and policy issues associated with the current high rates of biodiversity loss in such systems - whether the result of direct depletion, the destruction of habitat, or specialisation in agriculture, forestry and fisheries. This volume reports some of the more policy-oriented work carried out under the programme. l

The broad aim of the programme is to further our understanding of the causes and consequences of biodiversity loss, and to identify the options for addressing the problem. The results have turned out to be surprising to those who see biodiversity loss primarily in terms of the erosion of the genetic library. In various ways the work carried out under the programme has already begun to alter our perception of where the problem in biodiversity loss lies and what policy options are available to deal with it. Indeed, the programme has provided a powerful set of arguments for reappraising not just the economic and ecological implications of biodiversity loss, but the whole case for development based on specialisation of resource use.

It has shown that the real significance of loss of diversity lies less in its impact on the genetic library than in the effect it has on the range of environmental conditions under which ecosystems can continue to function. Loss of biodiversity implies loss of ecosystem resilience. For this reason it poses problems for policy wherever it occurs, not just in megadiversity areas characterised by high levels of endemism. Indeed, biodiversity may be a much more pressing issue in low diversity agro-ecosystems. The solutions to the problem of biodiversity loss are accordingly to be found more in reform of local institutions and local policies than in international institutions and transfer systems established to address the threat to the global genetic library. These are important and novel findings, and deserve to be taken seriously by policy-makers at all levels.

Not all participants in the Biodiversity Programme are represented in this volume, but the results reported here do indirectly reflect their contribution.2 Although many of the

1 For other policy-oriented results of the Biodiversity Programme see: Folke C., Ml!ler K.G. and Perrings C. (eds) Ambio Special Issue on the Economics of Biodiversity Loss, 21, 3, May 1992; Folke C., Myers N., McNeely J., Perrings C. (eds) Ambio Special Issue on Biodiversity: Ecology, Economics, Policy, 22, 2-3, May 1993; Perrings C. and Opschoor J.B. (eds) Environmental and Resource Economics Special Issue on Biodiversity Conservation, 4, 1, February 1994; and Barbier, Burgess and Folke [1994]. 2 Participants in Biodiversity Programme included: I-M Andreasson-Oren, Beijer Institute; E.B. Barbier, University of York; S. Barrett, London Business School; G. Brown, University of Washington; J. Burgess, University of York; M.S. Common, Australian National University; R. Costanza, University of Maryland; P. Dasgupta, Cambridge University; G. Daily, Stanford University; J. Dixon, World Bank; P. Ehrlich, Stanford University; A. Fisher, University of California, Berkeley; C. Folke, Stockholm University and Beijer Institute; M. Gadgil, India Institute of Science, Bangalore; C.S. Holling, University of Florida; A-M. and B-O. Jansson, Stockholm University; M. Kemp, University of Maryland; A. Lugo, US Forest Service; A. Markandya, Harvard University; K-G. Miiler, Stockholm School of Economics and Beijer Institute; J. McGlade, Warwick University; I.A. McNeely, mCN; M. Munasinghe, World Bank; B. Norton, Georgia Institute of Technology; T. Panayotou, Harvard University; D.W. Pearce, University College London; C. Perrings, University of York; A. Persson, World Bank; M. Rauscher, Institute of World Economics, Kiel; J. Roughgarden, Stanford University; R. Serafin, University of Waterloo; D. Southgate, Ohio State University; T. Swanson, Cambridge

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chapters are rooted in one or other of the two main disciplines represented in the volume, they have been informed by discussions involving a multidisciplinary group. The results reported here also reflect the very productive environment offered by the Royal Swedish Academy of Sciences and the Beijer Institute. The intellectual stimulus provided by the Institute's Chairman, Partha Dasgupta, Director, Karl-Goran Miiler, and Editorial Board, Buzz Holling, Bengt-Owe Jansson and Carl Folke has been enormous. Core funding for the programme derived from the Beijer Foundation and the Swedish International Development Authority (SIDA). Additional sources of funding are acknowledged separately by the chapter authors. Joydeep Gupta and Tom van Rensburg provided technical editorial support.

Charles Perrings Director, Biodiversity Programme York April 1994

University; R.K. Turner, University of East Anglia; L. Unemo, SIDA; B. Walker, CSIRO; M. Weitzman, Harvard University; M. Wells, formerly with the World Bank, now an independent consultant.