Conserving tropical biodiversity via market forces and spatial targeting

Abstract

The recent report from the Secretariat of the Convention on Biological Diversity [(2010) Global Biodiversity Outlook 3] acknowledges that ongoing biodiversity loss necessitates swift, radical action. Protecting undisturbed lands, although vital, is clearly insufficient, and the key role of unprotected, private land owned is being increasingly recognized. Seeking to avoid common assumptions of a social planner backed by government interventions, the present work focuses on the incentives of the individual landowner. We use detailed data to show that successful conservation on private land depends on three factors: conservation effectiveness (impact on target species), private costs (especially reductions in production), and private benefits (the extent to which conservation activities provide compensation, for example, by enhancing the value of remaining production). By examining the high-profile issue of palm-oil production in a major tropical biodiversity hotspot, we show that the levels of both conservation effectiveness and private costs are inherently spatial; varying the location of conservation activities can radically change both their effectiveness and private cost implications. We also use an economic choice experiment to show that consumers' willingness to pay for conservation-grade palm-oil products has the potential to incentivize private producers sufficiently to engage in conservation activities, supporting vulnerable International Union for Conservation of Nature Red Listed species. However, these incentives vary according to the scale and efficiency of production and the extent to which conservation is targeted to optimize its cost-effectiveness. Our integrated, interdisciplinary approach shows how strategies to harness the power of the market can usefully complement existing-and to-date insufficient-approaches to conservation.conservation | economics | Sumatra | oil-palm | biodiversity

Peeling back the label—exploring sustainable palm oil ecolabelling and consumption in the United Kingdom

“…In 2015, total global market uptake of RSPO certified palm oil was 2.76 million tonnes of mass balance, segregated, or identity preserved physical certified palm oil, and 3.43 million tonnes in the form of GreenPalm certificates (RSPO 2016c). Companies primarily opt to purchase certificates rather than physical certified palm oil despite the fact that research in the UK suggests consumers may be willing to pay a premium for products containing sustainable palm oil and marketed as such (Bateman et al 2010(Bateman et al , 2015.…”

Saving Tropical Forests by Knowing What We Consume

“…While these corporate commitments are undoubtedly influenced by the work of environmental groups through direct collaboration (e.g., Cargill and The Forest Trust;Cargill 2014) and pressure campaigns (e.g., Greenpeace campaigns against Unilever and Nestlé; The Economist 2010), the ultimate decision whether to adopt biodiversity-friendly strategies, when not legally mandatory, likely hinges to some degree upon their economic benefits (Rotherham 2005). Because adopting sustainability standards incur nontrivial costs (Bateman et al 2015), producers are more likely adopt them if: (1) consumer price premiums exist for products containing sustainable palm oil and/or (2) consumers have a negative opinion of unsustainable palm oil or a positive opinion of sustainable palm oil, possibly resulting in reputational damage and/or profit loss for corporations that do not adopt sustainability standards.…”

Natural capital and ecosystem services informing decisions: From promise to practice

“…Monetary valuation of ecosystem services is sometimes helpful. Market and nonmarket valuation methods from economics are used to estimate ecosystem service values [e.g., Bateman et al (60) in this issue]. Numerous studies report values for a range of services across many locations (61) but these first-generation studies generally are insufficient for robust extrapolation to other locations (58,62).…”