The benefits of nature-based tourism to biodiversity conservation are often presumed but rarely quantified. The relative value placed on attributes of nature parks is unknown, as is the contribution of biodiversity to tourists' willingness to visit a particular protected area. We surveyed tourists and foreign residents in Uganda to determine how preferences for particular protected areas are formed. We evaluated tourists' demand for elevated biodiversity levels (increased numbers of bird species seen), relative to other protected areas attributes. As the number of bird species increased, tourists demonstrated increased willingness to visit a protected area, independently of all other factors. We used these results to evaluate a revenue-maximizing park management strategy, and consider how revenues from nature-based tourism compare with those from local agricultural land-uses.

Greater ecosystem complexity is recognized by studying a two species predator–prey model under two property rights regimes: free entry and a system such as individual quotas which execute an economically optimal solution. A bottom-up management experiment is discussed in the context of Lake Victoria fisheries.

The overall goal of our paper is to better understand water management reform in China's rural communities, especially focusing on the effect that improving incentives to water managers will have on the nation's water resources and the welfare of the rural population. To pursue this goal, the paper has three objectives. First, we track the evolution of water management reform and seek to identify the incentive mechanisms that encourage water managers to more efficiently use water. Second, we identify the impact on crop water use of the incentives provided to water managers during reform. Since we are also interested in the possible negative consequences of an incentive-led water management reform strategy, the paper also explores how changes in incentives also affect agricultural production, farmer income, and poverty. Based on a random sample of 51 villages, 189 farmers, and 378 plots in four large irrigation districts in Ningxia and Henan provinces, both provinces in China's Yellow River Basin, our results show that in our sample areas the two main forms of water management reform, Water User Associations and contracting, have begun to systematically replace traditional forms of collective management. Our analysis demonstrates, however, that it is not the nominal implementation of the reform that matters, but rather it is the creation of new management institutions that offer water managers monetary incentives that lead to water savings. Importantly, given China's concerns about national food production and poverty alleviation, the reductions in water, at least in our sample sites, do not lead to reductions in either production or income, and do not increase the incidence of poverty.

The Emissions Compensation (EC) Program in Santiago, Chile, has been affected from the beginning by the incidence of individual violations of maximum-emission capacity permits. Based on information at the individual source level, in this paper we develop and estimate a model explaining the individual compliance decision with emission capacity permits. Our results indicate that the compliance behavior of sources during the period 1993–1999 do in fact depend on their individual characteristics. Among other factors, type of equipment used, industrial sector to which the source belongs, fuel type used, the initial allocation of emission capacity permits to the source, and population density as well as average income in the area where the source is located, turn out to be relevant. Furthermore, the evidence does not allow us to reject the presence of structural change in the individual decision to comply with permit holdings because of the introduction of natural gas in the Metropolitan Region of Santiago at the end of 1997.

Development projects that are potentially eligible for Clean Development Mechanism (CDM) funding under the Kyoto Protocol, require final approval from the host countries where the projects are to be implemented. The approval requires an evaluation of the positive contribution of the CDM project to sustainable development in the host country. A prototype set of sustainable development criteria is introduced using an evaluation process conducted in South Africa. Weighting values that reflect societal priorities in South Africa are required for these criteria. The paper shows how judgements of industry decision makers and the expenditure trends of the national government (on environmental sub-criteria) can be used to generate a first approximation of such weighting values. The industry judgements are obtained from an Analytical Hierarch Process (AHP) survey. They reflect the perceptions of the automotive supply chain and process industry only, and not other parts of the South African society. A more comprehensive study is required to determine the political and social acceptability of the AHP approach, which should be initiated and managed by the Designated National Authority (DNA) of South Africa.

This paper examines efficiency and equity in groundwater markets with special attention to output sharing contracts and to the bargaining relationships between sellers and buyers, using household level data from Madhya Pradesh, India. Regression results find no significant inefficiency on farms managed by output sharing buyers, presumably because optimal input intensities are achieved through effective monitoring and contract adherence mechanisms embedded in long-term and intensive personal relationships between sellers and buyers. As for equity, the finding is that, while output sharing buyers pay higher water prices, the rate of premiums is merely 5 percentage points higher than the informal interest rate that they would have had to carry under other types of groundwater contracts. The results also show that buyers who have access to alternative water sellers pay lower water prices. These findings indicate that if the imperfection of credit and contingent markets in rural areas are taken into account, informal groundwater markets work fairly well in agrarian communities if monitoring and contract adherence mechanisms are embedded and a sufficient number of potential sellers are available.

The paper examines how recent trends in agricultural productivity in Brazil, occurring both inside and outside the Amazon, affected deforestation and agricultural incomes. The analysis uses a computable general equilibrium model adapted to capture regional economic structures, and accounts for uncertainty concerning productivity improvements. Due to countervailing effects on deforestation of innovation inside and outside the Amazon – respectively, increasing and decreasing it – innovation in Brazilian agriculture in the period from 1985 to 1995 has not altered substantially deforestation rates. However, innovation inside the Amazon has to be reckoned as a driving force behind the continuing high levels of deforestation rates.

Innovation rates for livestock activities, inside and outside the Amazon, prove crucial in determining deforestation and agricultural income. Technological improvements outside the Amazon for small farm production systems and for farms in general in the North-East increase agricultural income, improve income distribution, and limit deforestation rates.

This article analyzes effects of insect-resistant Bt cotton on pesticide use and agricultural productivity in Argentina. Based on farm survey data, it is shown that the technology reduces application rates of toxic chemicals by 50 per cent, while significantly increasing yields. Using a damage control framework, the effectiveness of Bt versus chemical pesticides is estimated, and technological impacts are predicted for different farm types. Gross benefits could be highest for smallholder farmers, who are not currently using the technology. The durability of the advantages is analyzed by using biological models to simulate resistance development in pest populations. Rapid resistance buildup and associated pest outbreaks appear to be unlikely if minimum non-Bt refuge areas are maintained. Thus, promoting a more widespread diffusion of Bt cotton could amplify the efficiency, equity, and environmental gains. Conclusive statements about the technology's sustainability, however, require longer-term monitoring of possible secondary effects and farmers' behavior in maintaining refuges.

This paper examines the response of herders to increased shortage and degradation of land in an arid and semi-arid land setting in Kenya, under changing property right regimes using both survey and secondary data. We argue that the responses adopted are livelihood strategies to improve herder's welfare. We explore the determinants of three different strategies: crop cultivation, investment in land improvements, and migration with livestock. We employ the probit regression framework to explain each strategy. The main findings of the study are that private property rights, educational attainment, and availability of water are major determinants of the three strategies. We recommend policies that favour privatization of existing common property resources, improve education levels, and increase supply of water in the district.

We analyse data from sample surveys of water use and prices for households in 17 cities in Central America and Venezuela. In some of the cities, almost all sampled households have tap water, but in others many rely on nontap (‘coping’) sources. Coping households use less than one-fifth as much water as metered tap households do, face average water prices ten times as high, are much poorer, and face substantial water hauling costs. Water demand functions are estimated for metered tap households and coping households separately and jointly. Increasing block rates complicate estimation on metered tap households. Using 2SLS, we find price elasticities of water demand, with respect to both average and marginal water price, of about −0.3, with average price giving the greater partial effect. Coping demand has price elasticity closer to −0.1, and is also negatively affected by increased hauling costs. Estimations on the joint data indicate that the water connection itself explains most of the difference between tap and coping consumption and indicate serious problems in such data pooling.

This paper examines the implications of tenancy legislation and privatization of community lands in Goa on the supply of local public goods for soil conservation. In the post-tenancy period our survey reveals an increasing number of farmers being affected by salinity ingress. These findings support the hypothesis that when community institutions break down, individual agents who become new resource owners do not have sufficient incentive to undertake supply of local public goods, which leads to a decline in productivity and affects long-term sustainability.

Global climate change is expected to cause sea level rise, which will have major effects on Singapore because it is a small, low-lying island state. With the high degree of urbanization and industrialization on the island, land is scarce and very valuable. Examining three sea level rise scenarios for the next century, we explore whether Singapore should defend their coast or allow it to be inundated. Across ten coastal sites representing all market land in Singapore, we found that protection was the lowest cost strategy. The annual cost of protecting the coasts of Singapore will rise over time as the sea level rises and will range from 0.3 to 5.7 million US$ by 2050 to 0.9 to 16.8 million US$ by 2100. The present value of these costs ranges from 0.17 to 3.08 million US$ depending on the sea level rise scenario.

Recent micro-economic studies of in situ conservation of crop diversity focus on competition between modern and traditional varieties of major food crops. Our paper offers a different, crop system, approach and a limited-dependent variable econometric technique to model in situ conservation of both intra- and infra-species crop diversity in a context of heterogeneous ecological and market environments, using unique household-farm data from Mexico. Our findings reject separability and indicate that market integration significantly reduces crop diversity. They underline the importance of studying diversity in the context of larger cropping systems and economic environments.

International conservation investments are often made in the form of subsidies to purportedly eco-friendly enterprises rather than as payments conditional on habitat protection. Previous research demonstrated that direct payments for habitat protection are more cost effective than indirect subsidies for the acquisition of com-plementary inputs used in eco-friendly enterprises. In contrast to this earlier research, we assume in this paper that an ‘eco-entrepreneur’ may have market power. Market power is shown to compound the advantage of direct payments. Through a simple numerical example, we show that subsidies intended to achieve habitat conservation by encouraging the acquisition of complementary inputs can be spectacularly inefficient. In some cases it would be cheaper simply to buy the land outright. In other plausible cases, the indirect subsidy approach would simply be unable to achieve habitat conservation objectives no matter how much funding were available.

Hedonic valuation of quality attributes can be misleading when the assumption that these attributes are exogenous to sample selection is violated. This paper considers the simultaneity between hedonic valuation and sample selection in the context of a model of consumer behavior over packaged goods and investigates empirically how the decision on house location (urban/rural) affects the household's valuation of water-related characteristics of the house in question. The empirical analysis uses data from the Indonesian housing market and suggests that households value access to safe and improved domestic water sources. However, failing to correct for sample selection results in a biased valuation of willingness to pay for house characteristics. This might misguide policy recommendations for improved provision of domestic water, based on cost–benefit analysis.

This paper discusses the factors guiding household choices of cooking fuels. This is crucial for policies to combat indoor air pollution. Household income is an important, but not the only, factor. Opportunity costs of firewood also play an essential role. Empirical results are based on the 2000 Guatemalan LSMS survey, which includes a detailed section on energy use. Patterns of fuel use, energy spending, Engel curves, multiple fuels, the extent of fuel switching, and the determinants of fuel choice are analyzed.

It is common in Guatemala to use multiple fuels for cooking – 48 and 27 per cent of urban and rural households do so. Modern fuels are often used alongside traditional solid fuels; modern fuels thus fail to displace solid fuels in many cases, particular in rural areas and the urban bottom half. This is paradoxical since a significant share of firewood users buy wood from the market, incurring costs that are substantial, also in comparison with the costs of modern fuels.

The relationship between productive efficiency and sustainable development of fishing industries in developing countries has received little attention. Ill-structured property rights in common-pool resources lead to a contradiction between private and social technical efficiency, with private and social costs dependent on the level of technical efficiency. Development policies that increase private efficiency can increase the social cost with ill-structured property rights and common-pool resources, and thereby increase social inefficiency. This paper examines this relationship through a case study of the mini purse seine fishery of the Java Sea, and finds that private technical efficiency does not depend on any measurable attributes of human capital, diverges substantially between the peak and off seasons, and differs between vessels more within the off season.

People have a marginal role in managing forests located in the vicinity of their villages in Northern India. This situation is scrutinized in this paper by studying strategic play of forest users. Thereto, a 1 versus n−1 game of people's participation in forest management is estimated for three institutional and historical distinct cases at the State and village level. Critical discount factors are derived to verify whether incentives exist for villagers to mutually participate in managing commonly used forests. This paper finds such incentives in varying degrees for games at the State level and for games in 23 of the 32 considered villages.

This paper examines the property rights of the Cochin estuarine fisheries in India, which in spite of having well-defined access and conservation rules imposed by the state, have failed to ensure proper resource management. Considering the resource characteristics and the causes for state's failure, co-management, which requires a redefinition of management functions by state as well as users, has been proposed as an alternative. Analysis of user characteristics, using the two-stage estimation procedure, throws policy signals that under co-management the state can strengthen the licensing system to restrict access to fishing and to impart awareness regarding conservation rules. The logit analysis on users' role indicates that, although certain types of heterogeneities contribute towards the critical mass needed for a collective action, the distributional implications may lead at least some to oppose co-management. This implies that, even if users initially get to agree to co-operate and share any rents from conservation, significant prisoner's dilemma will soon occur returning the resource to its current state, and co-management will have to still grapple with lack of well-defined property rights.

Occasionally, households use forests as a source for collecting minor forest products. These goods can serve as an important additional source of income or nutrient supply. Considering this link between forest production and the agricultural sector, we estimate the collection function of the extractive good in a sample selection framework in which the wealth status, the prime agricultural cash source, and paid labour are assumed to influence the decision about collecting minor forest products. Results show that poorer households are more dependent on minor forest products. We also find that returns to labour in the agriculture and forestry sectors are not significantly different. We use these returns to establish shadow prices for the extractive good and in turn, use these to estimate price and income elasticities for the good's demand. The minor forest product is a normal good with unit elasticity; shadow income elasticity is equal to 0.82.