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Demand-side factors in optimal land conservation choice

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  • Ando, Amy W.
  • Shah, Payal

Abstract

The dominant paradigm of conservation-reserve planning in economics is to optimize the provision of physical conservation benefits given a budget constraint, implicitly assuming the value of biodiversity and ecosystem function is not affected by human proximity to that natural capital. There is evidence, however, that human willingness to pay (WTP) for conservation declines with distance--a phenomenon we call "spatial value decay". This paper begins a new strand of the conservation planning literature that takes demand-side factors - location of people in the landscape, the degree to which WTP for conservation depends on proximity - into account. We use theoretical models of linear abstract landscapes to explore the impact of demand-side factors on two facets of conservation choices: siting of a single reserve when conservation potential is greatest near a critical site, and siting of multiple reserves when fragmentation reduces physical conservation services produced. Our results show how planners should sometimes employ increased fragmentation to capture value when people's preferences are not very highly localized, and how optimal policy balances proximity to the ecologically critical site with proximity to people. In some scenarios, the payoff to using a reserve design approach that considers demand-side factors is large, but we find that spatial value decay reduces the benefits that can be gained from any conservation-planning approach.

Suggested Citation

  • Ando, Amy W. & Shah, Payal, 2010. "Demand-side factors in optimal land conservation choice," Resource and Energy Economics, Elsevier, vol. 32(2), pages 203-221, April.
  • Handle: RePEc:eee:resene:v:32:y:2010:i:2:p:203-221
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    1. Ando, Amy Whritenour, 2001. "Economies of Scope in Endangered-Species Protection: Evidence from Interest-Group Behavior," Journal of Environmental Economics and Management, Elsevier, vol. 41(3), pages 312-332, May.
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    5. Onal, Hayri & Yanprechaset, Pornchanok, 2007. "Site accessibility and prioritization of nature reserves," Ecological Economics, Elsevier, vol. 60(4), pages 763-773, February.
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    7. Nelson, Erik & Uwasu, Michinori & Polasky, Stephen, 2007. "Voting on open space: What explains the appearance and support of municipal-level open space conservation referenda in the United States?," Ecological Economics, Elsevier, vol. 62(3-4), pages 580-593, May.
    8. Kotchen, Matthew J. & Powers, Shawn M., 2006. "Explaining the appearance and success of voter referenda for open-space conservation," Journal of Environmental Economics and Management, Elsevier, vol. 52(1), pages 373-390, July.
    9. Hannon, Bruce, 1994. "Sense of place: geographic discounting by people, animals and plants," Ecological Economics, Elsevier, vol. 10(2), pages 157-174, July.
    10. Costello, Christopher & Polasky, Stephen, 2004. "Dynamic reserve site selection," Resource and Energy Economics, Elsevier, vol. 26(2), pages 157-174, June.
    11. Ronald J. Sutherland & Richard G. Walsh, 1985. "Effect of Distance on the Preservation Value of Water Quality," Land Economics, University of Wisconsin Press, vol. 64(3), pages 281-291.
    12. Albers, Heidi J. & Ando, Amy W. & Chen, Xiaoxuan, 2008. "Spatial-econometric analysis of attraction and repulsion of private conservation by public reserves," Journal of Environmental Economics and Management, Elsevier, vol. 56(1), pages 33-49, July.
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    Cited by:

    1. Maarten Punt & Hans-Peter Weikard & Ekko Ierland & Jan Stel, 2012. "Large Scale Marine Protected Areas for Biodiversity Conservation Along a Linear Gradient: Cooperation, Strategic Behavior or Conservation Autarky?," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 53(2), pages 203-228, October.
    2. Ando, Amy W. & Shah, Payal, 2016. "The Economics of Conservation and Finance: A Review of the Literature," International Review of Environmental and Resource Economics, now publishers, vol. 8(3-4), pages 321-357, June.
    3. Bamiére, Laure & David, Maia & Vermont, Bruno, 2011. "Agri-Environmental Policies When the Spatial Pattern of Biodiversity Reserves Matters," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 114239, European Association of Agricultural Economists.
    4. Sahan T. M. Dissanayake & Amy W. Ando, 2014. "Valuing Grassland Restoration: Proximity to Substitutes and Trade-offs among Conservation Attributes," Land Economics, University of Wisconsin Press, vol. 90(2), pages 237-259.
    5. Abildtrup, Jens & Garcia, Serge & Olsen, Søren Bøye & Stenger, Anne, 2013. "Spatial preference heterogeneity in forest recreation," Ecological Economics, Elsevier, vol. 92(C), pages 67-77.
    6. Odusola, Ayodele, 2015. "Economic and institutional determinants of foreign land acquisition in Africa: An empirical analysis," UNDP Africa Economists Working Papers 268727, United Nations Development Programme (UNDP).
    7. repec:eee:ecomod:v:222:y:2011:i:15:p:2856-2866 is not listed on IDEAS
    8. Katharine Sims, 2014. "Do Protected Areas Reduce Forest Fragmentation? A Microlandscapes Approach," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 58(2), pages 303-333, June.
    9. Wätzold, Frank & Drechsler, Martin, 2014. "Agglomeration payment, agglomeration bonus or homogeneous payment?," Resource and Energy Economics, Elsevier, vol. 37(C), pages 85-101.

    More about this item

    Keywords

    Conservation Species Habitat Optimal reserve-site selection Spatial Demand-side;

    JEL classification:

    • Q24 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Land
    • Q57 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Ecological Economics

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