renewable natural resource management and use without markets natural resources by their nature are not readily bent to the status of private property efficient resource use is complicated by jurisdictional externalities public goods non use values and beneficiaries spatially separated from the location of resources the task is made more challenging by ecological complexity that obscures cause benefits and effects costs and dramatic time lags between individual actions and subsequent social consequences that together with substantial uncertainty introduce the chance of irreversibilities resource economists have played a major role in the literature on externalities the development of individual transferable quotas non market valuation techniques and common property management

valuation of non priced amenities provided by the biological resources within the monteverde cloud forest preserve costa rica abstract to quantify the economic benefits of the monteverde cloud forest preserve and to test the contingent valuation method in a third world setting a contingent valuation survey was designed with five experimental treatments these determined an overall expected value per visitor determined and compared two ways of eliciting value single versus annual lump sum payments and compared average values of costa rican versus non costa rican visitors visitors were willing to pay to prevent the preserve s conversion to agricultural uses monteverde s value as a cloud forest preserve appears much higher than any value it might have in agricultural use despite lower incomes costa rican visitors valued the preserve more highly than non costa rican visitors visitors may have differentiated only weakly between greatly differing bid amounts expected values derived from econometric analysis of the differing experimental treatments suggest that further methodological adaptation of the contingent valuation method may be required 1 when it is applied in third world settings and 2 when precision is critical in estimating wtps

taking account of governance implications for land use dynamics food prices and trade patterns deforestation mainly caused by unsustainable agricultural expansion results in a loss of biodiversity and an increase in greenhouse gas emissions as well as impinges on local livelihoods countries governance performance particularly with respect to property rights security exerts significant impacts on land use patterns by affecting agricultural yield related technological investment and cropland expansion this study aims to incorporate governance factors into a recursive agro economic dynamic model to simulate governance impacts on land use patterns at the global scale due to the difficulties of including governance indicators directly into numerical models we use lending interest rates as discount rates to reflect risk accounting factors associated with different governance scenarios in addition to a reference scenario three scenarios with high low and mixed divergent discount rates are formed to represent weak strong and fragmented governance we find that weak governance leads to slower yield growth increased cropland expansion and associated deforestation mainly in latin america sub saharan africa south asia and southeast asia this is associated with increasing food prices particularly in sub saharan africa and southeast asia by contrast strong governance performance provides a stable political and economic situation which may bring down deforestation rates stimulate investment in agricultural technologies and induce fairly strong decreases in food prices

deforestation and the rule of law in a cross section of countries relationships between deforestation and population pressure income growth and insecure property rights are examined with data from 120 countries insecure property rights are hypothesized to arise from two sources government instability or inability to enforce ownership and an absence of government accountability the former source is captured by measures of general lawlessness such as guerrilla warfare revolution and frequent constitutional change the latter is proxied by variables indicating the type of government executive frequency of political purges and the existence of an elected legislature general support is indicated for the property rights hypothesis and for the effects of population growth

does altruism undermine existence value abstract the debate over the use of contingent valuation for existence values or passive use values has failed to explore the validity of motives for such values one potential motive altruism has conflicting implications for benefit cost analysis depending on whether the altruist is paternalistic this paper constructs models of three types of altruism and shows how benefit cost analysis responds to each type of altruism how damage assessment and restoration depend on each type and the implications of a population of heterogeneous altruists

valuing global ecosystem services what do european experts say applying the delphi method to contingent valuation of the amazon rainforest valuing global public goods like the amazon rainforest by stated preference surveys of a representative sample of the global population would be very costly and time consuming we explore the use of the delphi method in contingent valuation cv by asking a panel of 49 european environmental valuation experts in two rounds what they think would be the result if a european cv survey of amazon rainforest protection plans was conducted the experts best guess for the mean willingness to pay wtp by european households for preserving the current amazon rainforest and thus avoiding a predicted loss in forest area by 2050 from currently 85 to 60 of the original forest in the 1970s was 28 per household annually as an additional income tax aggregated over all european households this amounts to about 8 4 billion annually this preliminary estimate indicate that wtp of distant beneficiaries is substantial and could justify preservation of global ecosystem services where aggregated benefits of the local population often do not exceed the opportunity costs of preservation in terms of lost income from commercial activities the income elasticity of wtp with respect to per capita income in the european countries is 0 5 0 6 recognizing the limitations and assumptions of the delphi cv method it could still be a time saving and cost effective benefit transfer tool for providing international donors with much needed order of magnitude estimates of the non use value of ecosystem services of global significance

the eastern enlargement of the european union this paper examines the prospects and problems of eastern enlargement it argues that considerations of stability and long run prosperity are the primary reasons why the eu has promised to enlarge eastward and why the central and eastern european nations wish to join while high politics prompted this promise opposition from eu special interest groups is likely to delay fulfilment of the promise for many years if this is the case europe should create a series of intermediate steps that would permit the reintegration of europe to proceed apace if a quick enlargement does occur eu politics is likely to become much more complicated the ceecs would have many votes in the council of ministers yet they would be very different economically to the average eu incumbent

governance and deforestation a meta analysis in economics abstract understanding which aspects of forest governance have the potential to effectively reduce deforestation is central to reversing trends in global deforestation there is a multitude of empirical studies examining this relationship using various measures of governance and study designs coming to diverse conclusions in order to identify the source of variation across studies this article conducts a meta analysis of 32 empirical cross country studies in the field of economics containing 227 estimates of the impact of different governance measures on deforestation using an ordered probit model we find that the choice of the governance measure is the main factor in explaining variations in the outcomes of the studies in particular studies using environmental policy ownership rights presence of environmental ngos and rule of law as measures of governance are more likely to find that better governance reduces deforestation in contrast studies using democracy and rights as a measure of governance are more likely to find that deforestation increases when governance is improved the finding that not all aspects of governance improvements are equally supportive of forest conservation suggests that more nuanced analyses of specific aspects of environmental governance are required to guide evidence based policy making

a theory of participation in elections we analyze a model of participation in elections in which voting is costly and no vote is pivotal ethical agents are motivated to participate when they determine that agents of their type are obligated to do so unlike previous duty based models of participation in our model an ethical agent s obligation to vote is determined endogenously as a function of the behavior of other agents our model predicts high turnout and comparative statics that are consistent with strategic behavior jel d72

do focus groups and individual interviews reveal the same information for natural resource valuation abstract focus groups and individual interviews have become accepted methods used in the initial stages of valuation research whether focus groups and individual interviews reveal similar valuation information has not been thoroughly studied the research tests the hypothesis that focus groups yield the same ecosystem service information as do individual interviews the research also explores how the focus group and individual interview data might differ the analysis shows that focus groups and individual interviews are not substitutes they yield different information about ecosystem services and resource uses

the risk in hedge fund strategies theory and evidence from trend followers hedge fund strategies typically generate option like returns linear factor models using benchmark asset indices have difficulty explaining them following the suggestions in glosten and jagannathan 1994 this article shows how to model hedge fund returns by focusing on the popular trend following strategy we use lookback straddles to model trend following strategies and show that they can explain trend following funds returns better than standard asset indices though standard straddles lead to similar empirical results lookback straddles are theoretically closer to the concept of trend following our model should be useful in the design of performance benchmarks for trend following funds

enhancing the content validity of stated preference valuation the structure and function of ecological indicators stated preference surveys often provide ambiguous descriptions of ecological commodities yielding welfare estimates that have unclear interpretations and cannot be linked to measurable outcomes this paper proposes guidelines to promote ecological content validity in survey scenarios and defensible use of ecological information for welfare analysis these guidelines are illustrated through an application to migratory fish restoration content validity is evaluated vis a vis norms for communication of ecological changes in the ecological literature findings suggest that less structured treatment of ecological commodities may lead to an omission of information that is relevant to respondents and essential for valid welfare estimation

the political economy of eastern european trade with the european community why so sensitive ec trade with eastern europe jim rollo and alasdair smith despite agreements to open trade with eastern europe the european community has retained a substantial degree of protection against imports of sensitive products notably agricultural products textiles and clothing and steel this article investigates how sensitive these products really are it is true that the targeted products are important to the ec economy particularly in the poorer or declining regions yet trade with eastern europe only amounts to a very small proportion of the size of these sectors when a large increase in imports is simulated the overall effects on the community are not insignificant but are well within the range of the normal experience of economic change even without taking into account the fact that eastern markets for ec goods would also grow trade liberalization is welfare increasing particularly far eastern europe thus contingent protection which may seriously deter investment in eastern europe may simply be protectionism in any sector in which eastern europe is successful

individualized geocoding in stated preference questionnaires implications for survey design and welfare estimation this paper evaluates the common practice of generic mapping in stated preference valuation in which identical policy area maps are shown to all respondents this is compared to a more information intensive alternative in which individualized maps identify the location of each respondent s home relative to policy effects the evaluation is grounded in a theoretical model clarifying the impact of individualized spatial information on preferences for non market outcomes the model is illustrated using an application of choice experiments to riparian restoration in coastal maine results characterize valuation contexts for which valid preference elicitation likely requires the provision of individualized spatial information

tenure security private time preference and use of natural resources among lowland bolivian amerindians abstract to estimate the effect of tenure security and private time preference on the use of different types of natural resources such as old growth and fallow forests fish and game we did a survey and a psychological experiment with 443 households in 42 villages of yuracare mojeno tsimane and chiquitano indians in the bolivian lowlands results of multivariate tobit regressions suggest that 1 among the yuracare tsimane and mojeno rates of private time preference had a small economic and statistical effect on the use of natural resources and 2 tenure security proxied by residence duration in the village and by conflict with abutters only affected the consumption of wildlife principally of game results suggest that public policies to improve property rights over natural resources among indigenous people might have greater immediate impact on the conservation of wildlife than on the conservation of forest cover

the relationship between firm growth size and age estimates for 100 manufacturing industries this study uses a sample of all firms operating in 100 manufacturing industries to examine some aspects of firm dynamics it finds that firm growth the variability of firm growth and the probability that a firm will fail decrease with firm age it also finds that firm growth decreases at a diminishing rate with firm size even after controlling for the exit of slow growing firms from the sample gibrat s law therefore fails although the severity of the failure decreases with firm size copyright 1987 by blackwell publishing ltd

on the intergenerational allocation of natural resources it is known hartwick and others that under standard assumptions a society that invests in reproducible capital the competitive rents on its current extraction of exhaustible resources will enjoy a consumption stream constant in time it is shown here that this result can be interpreted as saying that an appropriately defined stock of capital including the initial endowment of resources is being maintained intact and that consumption can be interpreted as the interest on that patrimony this seems like a useful rule of thumb for policy

the perception and measurement of transaction costs the chapter discusses various explanations of how transaction cost minimising corporate configurations come about it contrasts darwinian with rational explanations finding both unsatisfactory what matters rather than computation of fully recognised transaction costs are managerial perceptions of transaction costs these perceptions are not expressed in numbers but in language this is related to arguments derived from bounded rationality and from transaction cost economics the chapter argues that issues of managerial perception must become central to analysis existing academic traditions which accord primacy to perception and to language are drawn upon and argued to be of great relevance to future work

agricultural expansion and deforestation modelling the impact of population market forces and property rights abstract this paper compares four different modelling approaches to agricultural expansion and deforestation and explores the implications of assumptions about the household objectives the labour market and the property rights regime a major distinction is made between population and market based explanations many of the popular policy prescriptions are based on the population approach assuming subsistence behaviour and limited market integration within a more realistic particularly for the long term effects market approach well intentioned policies such as agricultural intensification programmes may boost deforestation many forest frontier contexts are also characterized by forest clearing giving farmers land rights deforestation becomes an investment to the farmer and a title establishment strategy land titling and credit programmes may therefore increase deforestation

organizing a public ecosystem service economy for sustaining biodiversity abstract the core question this paper attempts to address is how social organization needs to respond to biodiversity features and functions in order to achieve its sustainable use scholars have suggested that the governance of complex systems should be dispersed across multiple centers of authority and that any regulative system needs as much variety in the actions that it can take as exists in the system it is regulating further it has been argued that complex ecosystems and biodiversity can successfully be maintained by complex polycentric multi layered governance systems which have a variety of response mechanisms but how should polycentric governance of biodiversity be organized borrowing from the organization of public economies in metropolitan areas we distinguish between production and provision of public ecosystem services and suggest the direction of institutional change for the organization of a public ecosystem service economy if the market alone cannot solve the allocation of public ecosystem services economic efficiency criteria based on hypothetical markets are not sufficient therefore we suggest design principles which go beyond economic efficiency and provide examples of the emergence of polycentric governance from an ethiopian coffee forest conservation project

property rights and deforestation in the brazilian amazon this paper focuses on the impact of property rights insecurity on deforestation in the brazilian legal amazon deforestation is considered as a risk management strategy property rights insecurity reduces the present value of forests and fosters forest conversion into agricultural and pasture lands moreover deforestation is the consequence of strategic interactions between landowners and squatters landowners clear the forest preventively in order to assert the productive use of land and to reduce the expropriation risk squatters invade land plots clear the forest and may afterwards gain official recognition with formal property titles a particular attention is paid to the measure of land property rights insecurity in the brazilian context it is assumed that property rights insecurity has a multidimensional character taken into account by the number of homicides related to land conflicts and expropriation procedures principal component analysis allows synthesising such information an econometric model of deforestation is estimated on a panel dataset on the 1988 2000 period and the nine states of the brazilian legal amazon the hypothesis that insecure land property rights contribute to higher rates of deforestation is not rejected when the simultaneity bias between insecure property rights and deforestation is addressed this result questions the modality of the brazilian land reform that considers forested areas as unproductive and thus open for expropriation procedures

a time to grow and a time to die growth and mortality of credit unions in new york city 1914 1990 one vision of organizational evolution suggests that old and large organizations become increasingly dominant over their environment a second suggests that as organizations age they become less able to respond to new challenges in this article the authors investigate which of these visions best characterizes the evolution of state chartered credit unions in new york city from 1914 through 1990 by analyzing the effects of organizational age size and population density on rates of organizational failure and growth the authors find evidence that old and small institutions are more likely to fail while young and small organizations have the highest growth rates

explaining welfare spending welfare expenditures are difficult to explain within a pure public choice framework in this article i shall argue that the difficulties may be resolved by assuming that the main purpose of welfare schemes is to provide the electorate in their capacity of different risk categories with insurance against various social risks rather than to redistribute economic resources towards weak and destitute groups in society this solution not only explains the scope of existing welfare arrangements but may also hold the key to an explanation as to how public welfare policies change and evolve across time

the contingent valuation debate why economists should care t he contingent valuation method involves the use of sample surveys questionnaires to elicit the willingness of respondents to pay for generally hypothetical projects or programs the name of the method refers to the fact that the values revealed by respondents are contingent upon the constructed or simulated market presented in the survey a spirited and occasionally mean spirited battle over such methods is currently being waged involving competing factions within the federal government economists and lawyers representing business and environmental groups and interested academics as well at issue is a seemingly quite specific question should environmental regulations currently under development at both the department of the interior and the department of commerce sanction the use of the contingent valuation method in estimating the damage done by spills of oil chemicals or other substances covered by federal law more generally the debate raises broad questions about what economists have to say about the values that individuals place on public or private goods the two papers that follow this one make cases for and against the use of the contingent valuation method my aim here is to provide an overview of the technique and the debate surrounding it i also want to suggest why this debate should matter to economists both professionally and in their roles as citizens and consumers

changing political regimes and tropical deforestation expansion of agriculture is a main cause of tropical deforestation government policies and weak property rights contribute to this process by encouraging landowners and landless to accelerate land clearing using panel data common to previous studies we add the dimension of new political regimes democratic and non democratic and investigate how the rate of agricultural land expansion in tropical countries depends on the nature and persistence of each regime we find that both new autocratic and democratic regimes have accelerated the expansion of agricultural land thus yielding support to some of the findings in the earlier literature interesting differences emerge between regions with the impact being most pronounced in latin america we interpret these results mainly in the context of increasing tenure and ownership insecurity which in turn is driven by the tendency of new regimes to implement land reforms as a form of social and economic policy or voter payback the argument is developed more formally using a simple competitive land use model that incorporates political regime dependent confiscation risk and agricultural subsidy policy

indices of biotic integrity in stated preference valuation of aquatic ecosystem services stated preference surveys often give minimal attention to distinctions between intermediate and final ecosystem services leading to the potential for welfare estimates that overlook misrepresent or double count associated values this paper illustrates potential mechanisms through which multimetric indexes of the type developed in the ecological literature here an index of biotic integrity can be used within stated preference survey scenarios to both improve the validity of survey responses and provide otherwise unavailable information on willingness to pay for intermediate and final ecosystem services we illustrate the approach using a choice experiment application to the restoration of migratory fish in a rhode island watershed where assumptions of the model hold results can allow transparent disentanglement and estimation of marginal values for both intermediate and final ecosystem services

the economics of tropical forest land use options tropical deforestation is generally characterized as conversion of forest land to alternative uses notably agriculture this would suggest the need for rational decision making concerning the optimal allocation of tropical forest land between competing uses the following paper explores this problem by devising rules for determining optimal land use allocation between timber and agriculture at the stand and forest levels a complementary intertemporal model for optimal allocation of forest land to agricultural conversion at the forest level is also developed and used to derive a demand relationship for agricultural conversion which is then approximated through empirical estimation

public open access and private timber harvests theory and application to the effects of trade liberalization in mexico a common popular assertion is that trade liberalization encourages deforestation but whether this is true depends on how trade policies affect the allocation of land among competing uses and how they influence illegal cutting of public forests a model is presented that allows for forests to be either public or private and public forests are divided into protected or managed and threatened categories effects of price changes are shown on each part of the forest an empirical version of the model is applied to the case of mexico with nafta most scenarios considered show that nafta will have positive long run effects on forest cover in mexico but that this is net of losses on private lands

towards an ecological economics of sustainability abstract persistent disagreement both as to the interpretation to be given to sustainability and as to the relation between ecological and economic sustainability has hindered the development of an ecological economics of sustainable resource use this paper identifies the main concepts of sustainability deriving from the two disciplines in order to explore the difference implied by an ecological approach to the problem it is argued that present economic and ecological approaches are largely disjoint and that they address basically different phenomena by combining the efficiency requirements of what is usually thought of as economic sustainability with the stability requirements of an ecological approach it is shown that an intertemporally efficient allocation of resources that satisfies the conditions for constant levels of consumption is not necessary to assure ecological sustainability ecological sustainability requires that the allocation of economic resources should not result in the instability of the economy environment system as a whole

the political economy of refunded emissions payment programs abstract we study the effects on the equilibrium tax of refunding firms pollution tax payments can lobbying yield stricter environmental policy do imperfect property rights affect policy clean firms may favor higher pollution levies but insecure property rights reduce this incentive

institutional ecological economics abstract new institutional economics and its forerunners have we argue made important contributions to the evolving agenda of ecological economics the conceptualisation of environmental problems as instances of interdependence and the acknowledgement of positive transaction costs are key insights into the nature of environmental problems we also discuss how plurality of behavioural motivations and limited cognitive capacity have important implications for environmental decision making and its analysis we show how evolutionary and collective action theories offer complementary takes on the choice and change of environmental governance institutions and how the concept of social capital can enrich analyses of environmental governance we conclude that an emerging institutional ecological economics has the greatest relative advantage in analysing the design implementation and effectiveness of environmental governance solutions

disagreements spinoffs and the evolution of detroit as the capital of the u s automobile industry the agglomeration of the automobile industry around detroit michigan is explained using a theory in which disagreements lead employees of incumbent firms to found spinoffs in the same industry predictions of the theory concerning entry and firm survival are tested using data on the origin location and years of production of every entrant into the industry from 1895 to 1966 the geographic concentration of the industry is attributed to four early successful entrants and the many successful spinoffs they spawned in the detroit area and not to conventional agglomeration economies benefiting co located firms as featured in modern theories of agglomeration implications of the findings regarding firm strategy are discussed

poverty policies and deforestation the case of mexico this study examines the determinants and policy implications of deforestation in mexico and includes a brief review of the relevant empirical literature and a description of the theoretical model land use patterns and socioeconomic and physiogeographic factors are determinants data were obtained from digital maps of land use and soils and the 1990 population and 1991 agricultural censuses a simple 2 period equation formalizes the relationship between deforestation and poverty government policies and local land tenure in period 1 representative producers in municipalities have 4 options in allocating labor time wage generation agricultural production deforestation on land without clear property rights and investment in technology during period 2 the options are to farm on available land and deforested areas or work in the wage sector findings reveal that 1 communal land tenure ownership by the ejido did not increase deforestation 2 pricing that favors maize production which is very land intensive increased deforestation and technical assistance reduced deforestation and 3 poverty was related to higher rates of deforestation prices were the most important immediate factor in unsustainable resource use but other factors had an impact the government policy mix did not support sustainable development reduced subsidies would benefit the environment the government should provide safety nets to increase the level of rural investment and reduce poverty and should improve land productivity with technical inputs trade liberalization and elimination of subsidies should be sensitive to the poors need for real wages

the economics of poverty in poor countries this paper which examines recently studied links between 1 poverty high fertility and undernourishment and 2 environmental degradation and civic disconnection in developing countries opens by reviewing the limitations of orthodox discussions of economic institutions and property rights and the orthodox dichotomy that has located the cause of poverty in the suppression of markets the introduction also notes that much of the analysis in this paper is based on data from sub saharan africa and india the next section of the paper summarizes evidence on the magnitude and extent of world poverty section 3 exposes the connection between undernourishment and a persons capacity to work as one of the pathways to the poverty trap sections 4 and 5 consider the dependence of impoverished rural populations on common property resources and how the conventional process of economic growth can break down this system and make certain sections of the population especially vulnerable to economic shocks the next two sections explore the possibility that links between poverty high fertility and environmental degradation may constitute another pathway to the poverty trap the eighth section reviews the methodology of using net national product which includes resource depletion and environmental deterioration as an evaluation criterion and argues that mainstream development economists may have neglected environmental and population problems because they have been relying on the wrong economic indices the final section concludes that a number of policies must be used to improve options for people

customer power strategic investment and the failure of leading firms why might firms be regarded as astutely managed at one point yet subsequently lose their positions of industry leadership when faced with technological change we present a model grounded in a study of the world disk drive industry that charts the process through which the demands of a firm s customers shape the allocation of resources in technological innovation a model that links theories of resource dependence and resource allocation we show that established firms led the industry in developing technologies of every sort even radical ones whenever the technologies addressed existing customers needs the same firms failed to develop simpler technologies that initially were only useful in emerging markets because impetus coalesces behind and resources are allocated to programs targeting powerful customers projects targeted at technologies for which no customers yet exist languish for lack of impetus and resources because the rate of technical progress can exceed the performance demanded in a market technologies which initially can only be used in emerging markets later can invade mainstream ones carrying entrant firms to victory over established companies

understanding declining mobility and inter household transfers among east african pastoralists we model interhousehold transfers between nomadic livestock herders as the state dependent consequence of individuals strategic interdependen ce resulting from the existence of multiple opposing externalities a public good security ext ernality among individuals sharing a social e g ethnic identity in a potentially hostile en vironment creates incentives to band together self interested interhousehold wealth transfers fro m wealthier herders to poorer ones may emerge endogenously within a limited wealth space as a mea ns to motivate accompanying migration by the recipient the distributional reach and size o f the transfer are limited however by a resource appropriation externality related to the use of com mon property grazing lands when this effect dominates it can induce transfers from households who want to relieve grazing pressures caused by others herds our model augments the extant li terature on transfers and is perhaps more consistent with the limited available empirical evi dence on heterogeneous and changing transfers patterns among east african pastoralists the core principles of our model possibly apply more broadly for example to long distance migrants or e ven among foot soldiers in street gangs

valuation of tropical rainforests philosophical and practical issues in the use of contingent valuation abstract this paper explores the possibility of using a large scale multi country contingent valuation study for making decisions concerning global resources in the specific context of valuing a large set of tropical rainforests before considering the practical issues involved in implementing such a study the paper addresses philosophical issues related to the use of contingent valuation including the role of passive use motives such as altruism and the role of information the implications of empirically based criticisms which argue that contingent valuation results are unreliable are also considered the main portion of the paper sketches the practical difficulties likely to be encountered in actually implementing a large contingent valuation study in multiple countries which seeks to value a common set of tropical rainforests some key study design choices are discussed

sequencing and nesting in contingent valuation surveys abstract the term embedding is ill defined and has been applied to distinct phenomena some predicted by economic theory and others not this paper lays out a theoretical framework for looking at these phenomena and provides a set of well defined terms included is a discussion of survey design problems which may induce spurious evidence in favor of the hypothesis that respondents are insensitive to the scope of the good being valued an empirical example of the component sensitivity is provided this test rejects the hypothesis that respondents are insensitive to the scope of the good being valued

effects of demographic and related microeconomic change on land quality in hills and mountains of developing countries abstract more than 70 empirical studies indicate that local population growth and its microeconomic manifestations in hills and mountains of developing countries do not necessarily threaten forest production agriculture livestock production or watershed stability population growth can make the cost of land relative to labor increase as this cost increases people often change their methods of managing economic plants and animals and make land improvements to offset initial declines in productivity that result from more frequent use of land thus the relationship between land productivity and relative land labor costs often resembles a u halting population growth or removing people from well settled areas might not improve productivity or reduce some off site damages

property rights and the evolution of a frontier as a frontier closes land goes from a state where land values are low and property rights undefined to a state where values have risen and tenure has become secure along this evolution the incentives for settlers to invest in productive activities and to expend resources to stake and enforce their claims will change this dynamic na ture of frontier settlement is modeled with special attention to the role of property rights a simulation of the optimal paths of the control and state vari ables which emerge from the model is used to analyze the phenomenon of frequent land sales by settlers jel q23

ownership risk investment and the use of natural resources the effect of insecure ownership on ordinary investment and natural resource use is examined insecure ownership is postulated to depend on the type of government regime in power and the prevalence of political violence or instability the political determinants of economy wide investment are estimated from cross country data and the results are used to form an index of ownership security when introduced into empirical models of natural resource use this index has a significant and quantitatively important effect on the use of forests and petroleum contrary to conventional wisdom ownership risk slows resource use in some circumstances

the united states bilateral debt for nature swaps and forest loss a cross national analysis we engage with the theoretical and empirical literature on the effectiveness of debt for nature swaps in promoting environmental protection we present cross national evidence that us bilateral deb

free markets and fettered consumers are consumers sufficiently self interested and self reliant so that privatized markets deliver the efficiency and welfare gains they promise why are consumers uncomfortable in markets and in some case sufficiently opposed to market solutions to prevent their implementation what can be done to prepare consumers so that they function satisfactorily in markets and understand the advantages of market based resource allocation this paper examines the foundations of consumer behavior and attitudes in markets and proposes a program of scientific research to determine how consumers cope in privatized markets and the implications for market design of the limits of self reliance

deforestation property rights and international trade deforestation primarily affects developing countries most developing countries share two characteristics 1 trade liberalization reforms in the last two decades and 2 weak property rights and limited rule of law this paper investigates this second best world first in a stylized model in which trade distortions are eliminated in an economy whose natural resources are subject to open access second empirically in an estimation exercise that disentangles the direct effect of trade on deforestation rates and an indirect effect through its interaction with ownership security in accordance with the theory the results show that only the indirect effect is significant

deforestation and the environmental kuznets curve an institutional perspective institutions for secure property rights and better environmental policies for moving the system towards a sustainable growth path can reduce the height of an environmental kuznets curve ekc relationship between income and deforestation this study examines the impact of these specific institutional factors on the ekc relationship for deforestation across latin american african and asian countries the factors related to agricultural production population economy and governmental policies of each country are hypothesised to affect deforestation results of the latin american countries show significant evidence of an ekc relationship for deforestation and also relevance of the institutional factors to reduce the rate of deforestation improvements in institutions for secure property rights and better environmental policies can thus significantly reduce the rate of deforestation without hindering the level of economic growth evidence also suggests that the effect of agricultural production on deforestation could be halted by strengthening institutional factors there was found to be complementarity between the institutional factors and forest sector polices and an additive effect between the institutional factors and forest products export promotion policies which could also eventually reduce the rate of deforestation

using the delphi method to value protection of the amazon rainforest abstract valuing global environmental public goods can serve to mobilize international resources for their protection while stated preference valuation methods have been applied extensively to public goods valuation in individual countries applications to global public goods with surveys in multiple countries are scarce due to complex and costly implementation benefit transfer is effectively infeasible when there are few existing studies valuing similar goods the delphi method which relies on expert opinion offers a third alternative we explore this method for estimating the value of protecting the amazon rainforest by asking more than 200 environmental valuation experts from 37 countries on four continents to predict the outcome of a contingent valuation survey to elicit willingness to pay wtp for amazon forest protection by their own countries populations the average annual per household values of avoiding a 30 forest loss in the amazon by 2050 assessed by experts vary from a few dollars in low income asian countries to a high near 100 in canada germany and norway the elasticity with respect to average ppp adjusted per household incomes is close to unity results from the delphi study match remarkably well those from a recent population stated preference survey in canada and the united states using a similar valuation scenario

discontinuous system of allowances the response of prosocial health care professionals abstract this paper examines the unintended strategic effects of non linear incentives in public policies a system of health care subsidies structured into discrete intervals may lead to strategic behaviour we provide new evidence on this issue focusing on a case where strategic actions are taken by healthcare providers hcps we show that hcps adjust the score of claimants in long term care needs assessments allowing claimants to access higher levels of care benefits this adjustment does not bring any pecuniary gain for hcps in a quasi natural experimental setting the implementation of spanish long term care ltc we show that the distribution of the claimants needs includes kinks around the thresholds set for the ltc system these kinks reveal that healthcare providers adopt prosocial behaviour helping claimants jump to a higher level of benefits without discriminating by health status residence or gender by developing a new non parametric estimator we prove that these adjustments increase the public ltc spending which is equivalent to moving thresholds to the left the additional cost per adjusted claimant per annum is approximately 1000 euro on average finally we also explore empirically whether the number of thresholds could affect such behaviour by exploiting a reform that eliminated some thresholds we find that the lower number of thresholds is associated with an increase of adjustment around the thresholds that remain

redd and forest transition tunneling through the environmental kuznets curve abstract international attention is focused on finding ways to reduce emissions from deforestation because of the emerging concerns over climate change however the causes of deforestation are rooted in current economic and development paradigms the causes of deforestation also vary across different geographical regions and have implications for the forest transition attempts to reach an international agreement on curbing deforestation have achieved little success despite over 30 years of un negotiations new initiatives from redd reducing emissions from deforestation and forest degradation could provide financial incentives to curb deforestation hence alternative development paths for forest cover changes and forest transition are analyzed for the redd policy within the framework of an environmental kuznets curve ekc for deforestation the ekc models are estimated for geographical regions of latin america africa and asia the results based on the panel data analysis of 43 countries covering the period 1970 1994 provides evidence that an inverted u shaped ekc fits for latin america and africa while a u shaped ekc applies to asia the results also indicate that strengthening agricultural and forestry sector policies are important for curbing deforestation the ekc models estimates could provide guidance for decisions on financing the redd policy as specific to each region

trade tragedy and the commons we develop a theory of resource management where the degree to which coun tries escape the tragedy of the commons and hence the de facto property rights regime is endogenously determined three forces determine success or failure in resource management the regulator s enforcement power the extent of har vesting capacity and the ability of the resource to generate competitive returns without being extinguished the model can explain heterogeneity across coun tries and resources in the effectiveness of resource management and it predicts that changes in prices population and technology can cause transitions to better or worse management regimes jel p14 q21 q22 q23 q32 many of the world s major renewable resource stocks are in a state of decline this is true for capture fisheries for forests in developing countries and for many measures of the biosphere s health other renewable resources including many species of wildlife marine mammals and coral reefs are also under threat while poverty and government corruption are surely respon sible for some of this record particular emphasis is often placed on the potentially damaging role played by international trade this emphasis is not surprising given that natural resource products are a key export for much of the developing world and property rights over renewable resources are both difficult to define and poorly enforced but property rights are not an immutable country characteristic such as weather mineral deposits or topography they are instead market institutions developed to facilitate transactions and protect scarce resources consequently changes in prices technology and other effects of market integration may alter the de facto property rights regime and lead to impacts quite dif ferent from those predicted by existing analyses the purpose of this paper is to examine renew able resource use within a framework where the enforcement of property rights and hence the efficacy of resource management is endogenously determined we develop a theory where an existing government regulates the use of a renewable resource by a set of agents who have a right to harvest the resource could be a fishery forest stock aquifer etc and we assume it is local and therefore contained within one country the govern ment sets rules limiting harvests but agents may cheat on these allocations and risk punishment property rights are endogenous in this framework because the government must account for agents incentive to cheat as a result the effective protection for the resource or what we refer to as the de facto property rights regime may be far from perfect even though property rights would be perfectly enforced if there was no monitoring problem

choice modelling and its potential application to tropical rainforest preservation abstract loss of rainforest occurs in part because of a global market failure problem markets routinely transmit signals about international demands for forest products such as timber but fail to transmit signals about demands for preservation to make efficient resource allocation choices decision makers need some framework to estimate the non use values that might be held by an international community for rainforest preservation non market valuation techniques can be used for this purpose but framing and other problems limit the application of the contingent valuation method cvm an alternative technique choice modelling cm appears to hold some promise because it can be used to model complex situations and to frame choices consistent with real life choices in this paper a cm experiment to assess the values that australians hold for rainforest conservation in vanuatu is reported the experiment disguises effectively the issue of interest rainforest conservation in vanuatu within a pool of other conservation locations also the experiment demonstrates that choice tradeoffs may involve a variety of environmental and socio economic factors rather than be concentrated on some monetary tradeoff the results demonstrate that a variety of predictive and valuation tools can be gained from a cm experiment and suggest that further development is warranted

willingness to pay for environmental improvements in a large city evidence from the spike model and from a non parametric approach in this paper the contingent valuation method cvm is applied in order toestimate the social benefits of a set of environmental and urbanimprovements planned for the waterfront of the city of valencia spain asa consequence of the expansion and restructuring of its trading port asthe data show a high rate of zero responses we applied the spike model one of the most recent models in cvm literature since traditional models logit and probit are not suitable given the characteristics of our data the non parametric approach is also applied in order to test the validity ofthe spike model the results show certain similarities between the spikemodel and the non parametric approach

explaining forest transitions the role of governance abstract we analyze how governance may influence competing land uses for forests and thus the occurrence of forest transitions across different low and middle income countries we develop a model of competing land uses that allows for governance to impact the risk of future versus current agricultural and forested land allocations the resulting hypothesis on the relationship between governance and the likelihood of a forest transition is then tested using cross country data the empirical analysis offers strong support for the competing land use framework and indicates that rule of law forest policy and regulatory quality influence forest transitions these findings inform not only the ongoing debate on forest transitions but also policy options for managing such transitions in developing economies

why and how much are firms willing to invest in ecosystem services from tropical forests a comparison of international and costa rican firms abstract in recent years schemes for payment for ecosystem services pes have emerged in tropical countries besides public demand the private demand offers the opportunity to develop pes the goal of this paper is to investigate the potential demand by firms for four ecosystem services from tropical forests biodiversity conservation carbon sequestration scenic beauty and watershed protection those are the four granted in the forest legislation and rewarded for in the pes scheme in costa rica to explain stated willingness to invest wti we assess influential factors expectations with respect to financial and non financial benefits of investing in ecosystem services experience with forest ecosystem services firm attributes like origin sector membership and size and finally perceived behavioral control we sent a questionnaire to over 900 international and costa rican firms from different sectors the low response rate of the survey of overall 6 can be explained by in a business context rather new topic of ecosystem services from tropical forests the analysis showed that a firm s willingness to invest wti depends on the origin of the firm international firms are interested in buying certificates mainly for carbon sequestration costa rican firms for all four ecosystem services in the following order watershed protection biodiversity conservation carbon sequestration and scenic beauty indirect and non financial benefits are surprisingly important and can impede the development of ecosystem service markets at the same time the activities of intrinsically motivated green entrepreneurs in a financially oriented firm setting might be a prerequisite within a firm context for bringing such innovative topics as ecosystem services from tropical forests to the table

the relationship between the income elasticities of demand and willingness to pay abstract the relationship between income and willingness to pay for collectively provided public environmental goods is investigated we show that while the income elasticity of willingness to pay and the ordinary income elasticity of demand are related knowledge of one is insufficient to determine the magnitude or even the sign of the other the income elasticity of willingness to pay is influenced by additional factors which are generally unobservable examples are provided to illustrate the degree to which the two income elasticities may diverge our results indicate that even when goods are demand luxuries they may or may not have income elasticities of willingness to pay which are greater than one

analysing decision behaviour in stated preference surveys a consumer psychological approach this paper applies a typology adapted from the consumer psychology literature to a contingent valuation method cvm survey we argue that the typology is helpful as a way of identifying responses that contain useful information on preferences for the environmental good in question relative to those which are unlikely to contain such information applying this framework to a cvm study of agri environmental payments in germany we find that some 90 of responses are preference revealing this distribution changes when the framing of the good is changed the typology may be of most use during the design stage of future cvm studies since it enables researchers to increase the fraction of responses that are useful

how altruism can prevail in an evolutionary environment abstract we study environments in which an individual gets a higher payoff from defecting than from cooperating and where copies of an individual are more likely to appear the higher is the individual s payoff we demonstrate that even in single shot prisoner s dilemma models where cooperation benefits one s opponent at a cost to oneself evolution can sustain cooperative behavior between relatives or neighbors in addition we show that selfish individuals who conciously choose their actions may find it in their interest to be altruistic when there is some probability that their practices will be imitated both genetic and cultural inheritance appear to be blunt instruments that do not operate on individuals in isolation those who inherit a genetic tendency to cooperate are more likely than others to enjoy the benefits of cooperative siblings similarly with culturel inheritance altruism can prevail when individuals are likely to interact with others who share the same role model

towards an economic theory of the multiproduct firm this paper outlines a theory of the multiproduct firm important building blocks include excess capacity and its creation market imperfections and the peculiarities of organizational knowledge including its fungible and taut character a framework is adopted in which profit seeking firms are seen to diversify in order to avoid the high transactions costs associated with using various markets to trade the services of various specialized assets neoclassical explanations of the multiproduct firm are shown to be seriously deficient

valuing environmental policy options a case study comparison of multiattribute and contingent valuation survey methods this paper describes a promising new evaluation approach called a value integration survey that uses the objectives and tradeoffs expressed by participants to value environmental policy options this constructive technique which builds on the interactive elicitation process of decision analysts assists stakeholders in clarifying their values and in agreeing on a policy alternative the paper compares this multi attribute valuation method to contingent valuation surveys describes the sequence of respondents tasks and presents results from a case study comparison of contingent valuation and value integration survey methods in the context of valuing options for fire control in oregon s oldgrowth forests

the role of tenure security and private time preference in neotropical deforestation a survey of 209 chimane amerindian households in 18 villages in the bolivian rain forest was done to examine the role of tenure security and private time preference on the clearance of old growth forest results of tobit regressions suggest that conflict with abutters was associated with more deforestation but the average impatience of the household heads was associated with less deforestation results suggest that governments should protect the land rights of indigenous people if they wish to enhance conservation results cast doubts on the idea that high private time preference increases the depletion of natural resources

population tenure and natural resource management the case of customary land area in malawi abstract this paper analyzes the factors determining conversion of woodlands to agricultural land changes in tree cover and maize yield for the last two and a half decades by using aerial photos and field survey data in 57 communities in malawi the econometric analysis revealed that population pressure led to greater land conversion but had no effect on yield or tree cover changes areas where greater changes in traditional tenure systems have occurred are associated with reduction in tree cover and expansion of agricultural land these results suggest the importance of strengthening institutions to manage natural resources

measuring the productivity of threatened species programs abstract expenditures on threatened species programs are increasing in many countries evaluation of the effectiveness and cost efficiency of these programs rarely occurs an obstacle to evaluation of these programs is the need for a versatile unit of output this paper reports how an output measure copy and cost utility analysis methodology are applied to evaluate new zealand threatened species programs program effectiveness cost and cost utility ratios are presented and the results show wide divergences occur between the programs studied cost utility analysis provides a practical means to evaluate the productive efficiency of many threatened species programs

what to value and how ecological indicator choices in stated preference valuation the ecological literature accepts that many policy outcomes cannot be observed directly and must be characterized using indicators multiple indicators can often be used to communicate similar ecological outcomes previous studies using alternative indicators in stated preference surveys suggest that welfare estimates may be indicator dependent casting doubt on whether welfare estimates are sufficiently reliable for cost benefit analysis we suggest that the reason for such indicator dependence may be that indicators used in these prior studies represented different outcomes valued by respondents this possibility underscores the need for greater attention to selection of indicators and their properties within stated preference survey design this paper develops a model introducing the concept of outcome equivalent indicators defined as indicators that provide alternative representations of identical underlying outcomes to assess empirically whether welfare estimates are indeed robust to indicator choice when alternative indicators are expected to be outcome equivalent we analyze data from a choice experiment estimating willingness to pay for migratory fish restoration in rhode island usa results demonstrate that welfare estimates are robust to the use of alternative ecological indicators within stated preference scenarios

betrayal as market barrier identity based limits to diversification among high status corporate law firms1 why are some diversified market identities problematic but others are not we examine this question in the context of high status corporate law firms which often diversify into one low status area of work family law fl but face a barrier strong disapproval from existing clients that prevents diversification into another such area plaintiffs personal injury law pil drawing on a qualitative study of the boston legal market we argue that this barrier reflects a situation where loyalty norms have been violated and it surfaces because service to individual plaintiffs is tantamount to betraying the interests of corporate clients our analysis clarifies identity based limits to diversification indicating that they are rooted in concerns about the firm s commitments as well as its capabilities and suggests a more general refinement of theory on status and conformity

property rights genetic resources and biotechnological change it is well recognized that wild genetic resources the genetic constitutions of plants and animals have substantial social and economic value as repositories of genetic information today genetic information provides direct and indirect inputs into plant breeding programs the development of natural products including drugs and pharmaceuticals and increasingly sophisticated applications of biotechnology 2 recognition of the potential of wild genetic resources in the development of drugs has led the national cancer institute to initiate a massive plant collection project 3 which is a follow up to an earlier 1970s project that sought to identify drugs effective against a variety of cancers and to look at the immune system effects of various drugs it is estimated that 70 percent of the 3 000 species known to have anticancer properties are found in the tropical forests 4 in recent years a number of widely used drugs have been developed from plants including two important anticancer drugs derived from the rosy periwinkle found in tropical madagascar with the recent major breakthroughs in biotechnology the future potential of these resources seems limitless species that have no current commercial application have useful natural chemicals or are as yet undiscovered never

why are firms rigid a general framework and empirical tests we present a general framework for understanding why firms are slow to make major strategic changes in a wide range of empirical settings we then apply this framework to investigate more specifically the relationship between firm age and scope in hedge funds our empirical analyses demonstrate that younger hedge funds outperform older hedge funds both before and after the launch of a new fund based on our framework these results suggest that age based rigidity in hedge funds is more attributable to internal political frictions that influence project selection than to constraints associated with exchange partners or implementation costs we conclude by discussing how our framework can be used to identify the dominant source of rigidity in other contexts