Economics and Conservation in the Tropics: A Strategic Dialogue

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Achieving lasting conservation outcomes is not easy. In early 2008, the Conservation Strategy Fund, Resources for the Future, and the Gordon and Betty Moore Foundation convened experts to discuss the role of economic analysis as a conservation tool in developing countries.

Economic analysis presents a set of opportunities for conservationists. It can shed light on the interactions between nature and the conventional economy, quantify the pressures that lead to habitat loss, and depict nature’s economic contributions to communities, industry, agriculture, and our overall wellbeing. It is particularly suited to the monetary valuation of natural goods and services, the establishment of markets for environmental services, and the design of policies to encourage conservation.

But while many people see potential value in conservation-oriented economic analysis, there isn’t a consensus on which research, market, and policy approaches work best.

Ideas advanced at the workshop can be grouped under three broad themes:

Conservation economists should do more than monetary valuation. Valuation is a means to an end­—namely, better decisionmaking—rather than an end in itself, and should be tied clearly to real-world conservation policy and management issues.

Deploying conservation economics in the field involves more than payment for ecosystem service (PES) schemes. PES is just one kind of policy intervention that has captured the attention of many conservation organizations, although economic analysis may recommend some other incentive-based instrument or a command-and-control or education-based intervention. Participants’ level of optimism for PES varied widely, but they agreed that the development of local expertise and capabilities is fundamental. Whatever policy or conservation project is attempted, it needs to be supported by locally generated research, received by local policymakers with a strong grasp of its economic rationale, and administered by professionals also familiar with economic principles.

Conservation economics methods need improvement in a few key areas:

• More scientific evaluation is needed to determine which interventions actually further environmental and sustainable development goals. Systematic analysis rarely occurs because of its high cost, technical difficulty, and the lack of incentives for it within NGOs, foundations, or academia.
• Both economics and ecology will become more useful for conservation purposes when these two disciplines are combined. Good conservation economics requires a thorough understanding of ecological factors, forces, and changes.
• Lower discount rates for long-term environmental benefits should be proposed, which means that long-term conservation would be given more value in economic analyses
• Economists need to refrain from calculating incremental losses in economic value from degrading ecosystems that may be near the point of collapse.
• Economists need to account for possibly large shifts in future demand for environmental goods and services.
• More needs to be done to bring the difficult-to-measure values of pure public goods (like biodiversity) into decisionmaking.

The papers available here reflect the points of debate and commentary, as well as empirical analysis and methods, among conference participants.

Conference Synthesis Note

John Reid and James Boyd

Allen Blackman

Allen Blackman

Juan-Camilo Cardenas 

How Do Property Rights Affect Individual and Collective Use and Conservation of Land, Timber, Water, Fish, and Other Important Resources?

Juan-Camilo Cardenas 

John A. Dixon

John A. Dixon

Lucy Emerton

Ecosystems, Infrastructure, and the Use of Economics to Influence Decision making

Lucy Emerton

Paul J. Ferraro 

Paul J. Ferraro

Robin Naidoo

Stefano Pagiola

Stefano Pagiola

Linwood H. Pendleton 

Linwood H. Pendleton

Richard Rice

Richard Rice

Sven Wunder

Sven Wunder