This paper gives an ecologist's overview of the deteriorating environmental situation. It then describes areas where the activities of ecological economists seem appropriate (e.g., ecosystem service valuation, trade) and others requiring more attention (e.g., definitions of utility, social discounting, preserving population diversity, global toxification, the epidemiological environment, overpopulation, overconsumption, the economic impacts of nuclear explosions, and the equilibration of opportunity costs when attempting to solve global dilemmas). A general problem is the failure of ecological economists adequately to communicate their results and concerns to the general public and to decision makers. In view of the demonstrable failure of traditional economics to focus its attention on what will be the central issues of the twenty-first century, it is clear that ecological economics is in a position to become the central subdiscipline of economics. In order to do so, it is important for ecological economists to always keep the ‘big picture’ in view.

Paul Ehrlich has written a wonderful article with the purpose to convince economists to switch their research interests to what he calls ecological economics. His argument is twofold. If our intellectual capacity is not geared towards these issues, humanity may be heading for a big disaster. Secondly, it gives tremendous opportunities for economists: the ones who switch will end up in the centre of the profession, because society will be in big need of their expertise.

Paul Ehrlich has a clear message for the economics profession: humanity faces a number of serious environmental problems and economists have a central role to play if we are to successfully address them. The article lays out an important research agenda for economists, which includes climate change, loss of biodiversity, release of toxic substances, epidemiological concerns, population, and over-consumption. Even if one disagrees with some of the particulars, and my guess is that many economists who read the article will, the big ideas contained in this article and the main messages are worthy of close attention. Rather than being on the periphery of the economics profession, those of us in economics who focus on environmental issues, whether called ecological economists, environmental economists or resource economists, should be at the heart of an economics profession focused on the most important and relevant issues facing society.

The following paper is concerned with water sharing of the Ganges River between India and Bangladesh, with possible augmentation through water transfers from Nepal. We analyzed the case when water from Nepal can be transferred to Bangladesh through the upstream country, India, as the local geography only permits such water transfer. A game theoretic model is formulated to determine the optimal share of water diverted to Bangladesh by India, and the optimal amount of water transfer from Nepal. India may gain positive externalities from such water transfer. The positive externalities generated from water transfer from Nepal may influence the water share of both India and Bangladesh. In the absence of altruism, India would allow less water flow to Bangladesh than in the case when there is no provision to buy water from Nepal. We also explored whether positive externalities could induce India to buy water jointly with Bangladesh, and such a case will only occur if the countries possess altruistic concerns and share water according to an agreement.

This paper analyzes overlapping-generations models where natural capital is owned by selfish agents. Transfers in favor of young agents reduce the rate of depletion and increase output growth. It is shown that intergenerational transfers may be preferred to laissez-faire by an indefinite sequence of generations: if the resource share in production is sufficiently high, the welfare gain induced by preservation compensates for the loss due to taxation. This conclusion is reinforced when other assets are available, e.g. man-made capital, claims on monopoly rents, and R&D investment. Transfers raise the welfare of all generations, except that of the first resource owner: if resource endowments are taxed at time zero, all successive generations support resource-saving policies for purely selfish reasons.

At the community level, bylaws and other regulations are commonly used to manage natural resources. However, there is limited research on how communities enact these regulations and what determines awareness and compliance with these regulations. A survey of 273 communities was conducted in Uganda with an objective of analyzing the determinants of enactment, awareness and compliance with community Natural Resource Management (NRM) regulations. Presence in the community of programs and organizations with focus on agriculture and the environment increases the probability to enact and to be aware of NRM regulations. The probability to comply with regulations enacted by village councils was greater than the case with such regulations passed by higher legislative bodies, suggesting the important role played by decentralization in NRM. Poverty is associated with lower compliance with NRM regulations. This supports the poverty-natural resource degradation trap hypothesis, and suggests that measures to reduce poverty can also improve NRM.

This paper reviews the state of economic understanding about fuelwood in developing countries. It synthesizes the main results from numerous empirical studies with the intent of identifying implications for policy and pointing out where important questions remain unanswered. Overall, the empirical results reviewed reinforce the contention that households alter their behavior in the presence of sufficient scarcity in ways that are least costly to them. Still, the cost can be substantial and many cases remain where policy intervention is justified to address concerns of both equity and efficiency. Addressing the coping capabilities of the very poor and the open access conditions of woodlands appear to be two ways of dealing with fuelwood scarcity that are likely to yield high social rates of return. Community forestry has the potential to address these two important areas, but there is little evidence to date that this is being done with fuelwood in mind.