Biopolicy, Volume 2, Paper 5 (PY97005) 1997, April 25th 1997
Online Journal - URL: http://www.bdt.org.br/bioline/py
The Successful Use of Economic Instruments to Foster
Sustainable Use of Biodiversity: Six Case Studies from Latin
America and the Caribbean*
Commissioned by the Biodiversity Support Program on behalf of
the Inter-American Commission on Biodiversity and Sustainable
Development, In preparation for the Summit of the Americas on
Sustainable Development, Santa Cruz de la Sierra, Bolivia,
December 6-8, 1996
Received March 23rd, 1997
Published April 25th, 1997
Joseph Henry Vogel
Code Number: PY97005
Size of Files:
Text: 170K
Graphics: Photographs (jpg) - 54K
[Note: this paper is also available in Spanish (PY97005s) and
Portuguese (PY97005p)]
CONTENTS
Executive Summary
Introduction
The Irreversibility of Extinction
The Instability of Preferences
The Humble Alternative to Bankrupt Economics
Case Studies
Existence [Non-amenable to a case study approach]
Ecotourism Case 1: The optimal
price of park admission, Costa Rica
Case 2: The Marine Park, Saba, Netherlands
Antilles
Environmental Services: Case 3: The Ecological VAT, Parana, Brazil
(Value Added Tax) [Imposto sobre
Ciculacao de Mercadorias e Servicos
Ecologico - ICMS Ecologico]
Sustainable Agriculture Case 4: Centro Fatima,
Pastaza, Ecuador
Extractivism Case 5: The Sea Turtle Conservation
Project, Reserva de Usos Multiples en Barra de Santiago
(The Multiple Use Reserve at Barra de Santiago), El Salvador
Bioprospecting Case 6: The Impossibility of a Successful
Case without a Cartel
Conclusions and Recommendations
Endnotes 1 - 14
Additional Information a - f
References
EXECUTIVE SUMMARY
INTRODUCTION
The Samuelsonian equation for the optimal allocation of public
goods is a theoretical construct for the conservation of
biological diversity. The policy implication of the equation
is straightforward: one aggregates all the simultaneous values
generated from biological diversity and recommends conserving
habitat until the cost of the last hectare conserved just
equals the incremental aggregate value. Nevertheless, a
fundamental theoretical problem exists in the methodology:
preferences are unstable over human generations and any
recommendation based on currently observed preferences may
turn out to have underestimated the values resultant from the
preferences of future generations. This shortcoming does not
escape conservationists. To the extent it is routinely
ignored, economic theory itself has fallen into disrepute. For
example, the distinguished biologist Professor E.O. Wilson
states flatly that contemporary economics is bankrupt.
The humble alternative to bankrupt economics recognizes the
incommensurability of biological diversity and hopes only to
internalize the externalities of protected habitats. The
physical scope of these protected areas should be determined
not by economic criteria but by safe minimum standards the
precautionary principle. Six distinct categories of value can
be simultaneously generated from conservation: existence,
ecotourism, environmental services, sustainable agriculture,
extractivism, and bioprospecting. Seldom will any one of the
six be sufficient to justify the opportunity costs of the
seemingly more profitable activities that would
exterminate biological diversity. The challenge for
conservation is to create a package of sustainable activities
that in total can alleviate the economic and political
pressures to relax or abandon safe minimum standards.
Copyright remains with the author.
