Chaiechi, T., and Stoeckl, N. (2013) Estimating the costs of conservation in multiple output agricultural setting. World Academy of Science, Engineering and Technology, 78. 316. pp. 1861-1868.

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Abstract

Scarcity of resources for biodiversity conservation gives rise to the need of strategic investment with priorities given to the cost of conservation. While the literature provides abundant methodological options for biodiversity conservation; estimating true cost of conservation remains abstract and simplistic, without recognising dynamic nature of the cost. Some recent works demonstrate the prominence of economic theory to inform biodiversity decisions, particularly on the costs and benefits of biodiversity (see [1], and [2]) however, the integration of the concept of true cost into biodiversity actions and planning are very slow to come by, and specially on a farm level. Conservation planning studies often use area as a proxy for costs neglecting different land values as well as protected areas. These literature consider only heterogeneous benefits while land costs are considered homogenous. Analysis with the assumption of cost homogeneity results in biased estimation; since not only it doesn’t address the true total cost of biodiversity actions and plans, but also it fails to screen out lands that are more (or less) expensive and/or difficult (or more suitable) for biodiversity conservation purposes, hindering validity and comparability of the results. "Economies of scope" is one of the other most neglected aspects in conservation literature. The concept of economies of scope introduces the existence of cost complementarities within a multiple output production system and it suggests a lower cost during the concurrent production of multiple outputs by a given farm. If there are, indeed, economies of scope then simplistic representation of costs will tend to overestimate the true cost of conservation leading to suboptimal outcomes. The aim of this paper, therefore, is to provide first broad review of the various theoretical ways in which economies of scope are likely to occur of how they might occur in conservation. Consequently, the paper addresses gaps that have to be filled in future analysis.

Item ID:	28673
Item Type:	Article (Scholarly Work)
ISSN:	2010-3778
Keywords:	cost, biodiversity conservation, multi-output production systems, empirical techniques
Date Deposited:	20 Aug 2013 02:17
FoR Codes:	14 ECONOMICS > 1402 Applied Economics > 140201 Agricultural Economics @ 70% 14 ECONOMICS > 1402 Applied Economics > 140205 Environment and Resource Economics @ 30%
SEO Codes:	91 ECONOMIC FRAMEWORK > 9102 Microeconomics > 910204 Industry Costs and Structure @ 40% 91 ECONOMIC FRAMEWORK > 9104 Management and Productivity > 910404 Productivity (excl. Public Sector) @ 60%
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