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6/5/2012 Biodiversity Slides 1

Biodiversity Conservation: Outline

Introduction: Biodiversity values and conservation strategies

Resource Allocation Principle for Protecting Biodiversity:

Noah’s Ark

Pharmaceutical Values for Biodiversity Conservation

Setting Aside Land to Protect Biodiversity

Restricting Land Uses to Protect Biodiversity, ESA.

Debt-for-Nature Swaps


Biodiversity Conservation: Outline

Introduction: Biodiversity values and conservation strategies

Resource Allocation Principle for Protecting Biodiversity:

Noah’s Ark

Pharmaceutical Values for Biodiversity Conservation

Setting Aside Land to Protect Biodiversity

Restricting Land Uses to Protect Biodiversity, ESA.

Debt-for-Nature Swaps


Model 1: Resource allocation problem (Noah’s Ark)

• Several projects are proposed to conserve biodiversity.•

We can estimate all relevant parameters for each project.

• We have a limited budget.

• Which projects should be chosen?


Notation:

i = a specific project designed to protect a target species.

Bi = Biodiversity value of species protected by project i.

Ui = Use value of species protected by project i, if preserved.

Ci = Cost of project i.

Pi(0) and Pi(1) indicate the probability that the species will survive without (0) and with (1) project i.

Pi = Pi(1) - Pi(0): Change in probability of survival caused by project i.


Project i’s payoff = (Bi + Ui )Pi.

Allocation rule (Noah’s Ark Principle):

Rank projects in decreasing order of

Ri = {(Bi + Ui )Pi}/Ci .

Undertake projects for which Ri>1, in this order, until funds are exhausted.


Model 2: How to value the pharmaceuticals that biodiversity may yield?

Large fraction of existing pharmaceuticals were derived from natural substances.

• Quinine from chinchona tree (malaria)

• Taxol from Pacific yew tree (cancer)

• Vincristine from rosy periwinkle (lukemia)

Total gain from protecting all of this genetic information? Potentially huge.

More relevant question for policy: What is the gain from protecting a marginal species, or a marginal acre of habitat?


Estimating the value of biodiversity for pharmaceutical uses:

Sample problem:

Researchers are looking for a cure to a specific form of cancer.

P = probability that a test of a random species is a success.

R = value of a success, if discovered.

C = cost of a test.


Expected payoff from testing a single species for this cure:

V(1) = (PR - C)

Expected payoff from testing two species for this cure:

V(2) = (PR - C) +(PR – C)(1 – P).


Expected payoff from testing N species for this cure:

V(N) = (PR - C) + (PR – C)(1 – P) + (PR - C)(1 - P)2

+ (PR - C)(1 - P)3 + . . . . .

. . + (PR - C) (1 - P)N-1.

Marginal payoff from having the Nth species available to test:

MV(N) = (PR - C) (1 - P)N-1.

Note: (PR - C) depends positively on P, (1-P)N-1 depends negatively on P.


C/R 1.0

MV(N)

PP*

Determining ‘most advantageous’ P, P*.


Estimating MV(N) (from SSR, 1996):

R = $450 million for a successful drug.

C = $3,600 per test.

N = 250,000 flowering plants.

P* = .0000012

Bottom line: Maximum pharmaceutical value for preserving a hectare of western Ecuador: $20.63.


Policy for protecting biodiversity: Creating protected areas

Protected Area“Area of land and/or sea especially dedicated to the

protection and maintenance of biological diversity,

and of natural and associated cultural resources, and

managed through legal or other effective means.”

Source: UNEP and World Commission on Protected Areas (IUCN),

World Database of Protected Areas.


Protected Area“ . . . . . . . dedicated to the protection and maintenance of

biological diversity, and of natural and associated cultural

resources. . . . . . and managed through legal or other effective

means.”

Source: UNEP and World Commission on Protected Areas (IUCN), World

Database of Protected Areas.


Social Determinants of PA Performance

Competing Uses for Land and Resources (determinants)

• Resource extraction (density and value of timber, game, minerals, forage for animals; proximity to roads, rivers)

• Subsistence agriculture (poverty, income levels, population density; soil quality, rainfall, slope; proximity to roads, rivers)

• Permanent agriculture (soil quality, rainfall, slope; access to markets, e.g., proximity to roads, rivers, population centers)


Social Determinants of PA Performance (cont.)

Cost of Protection

• Cost of protection inputs (labor, capital)

• Remoteness

PA Performance and Host Country Governance

• Presence or absence of corruption among managers/enforcers

• Adequacy of host government enabling policy

• Ability and incentive to commit to long-term conservation goals.


Corruption and Illegal LoggingIllegal logging

• Harvesting in protected areas

• Harvesting protected species

• Harvesting in excess of concessions

• False reporting of harvests


Source: Tropical Forest Update, Vol. 12 (1) 2002, p. 4.


Restricting Land Uses to Protect Biodiversity, ESA.(Discussion in Field, pp. 392-397)

Adopted without controversy in 1973.

ESA Process• FWS and NMFS rank species by endangerment risk

Threatened/endangered.• If listed, develop a ‘recovery plan’.

Complaints about ESA approach• ‘Habitat plan’ approach land use options.• “Shoot, shovel and shut up” response possible.


Complaints, cont.

Effectiveness: • Of 1,664 plants and animals listed, < 700 have recovery plans.• Only 11 have been removed from list.• Few have showed improved population status.

Selection of Species: • ‘Charismatic megafauna’: bald eagles, wolves, whooping cranes, …. • Selection not related to scientific biodiversity values .• More like ‘zoo’ popularity.

Should policy protect ecosystems, rather than individual species?


Debt-for-Nature Swaps, an emerging form of environmental transaction

Product transacted: protection of biodiversity, natural habitat.

Buyers: Conservation NGOs.CI, TNC, WWF;Developed country agencies, US, Sweden, Netherlands.

Sellers: Host country government agencies and NGOs:Costa Rican National Parks Foundation;Bolivian FONAMA (NGO);Ecuadoran Fundacion Natura.

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