Resource-dependent livelihoods and the natural resource base

The natural resource base, terrestrial and marine, provides rural households in lower-income countries with income, food, shelter, and medicines, which are variously gathered and hunted in common lands and waters. These resources may be actively managed, whether by the government or local community; or may be de facto open access, with little effort by governments to prevent what may be de jure illegal extraction. This paper provides an appraisal of the literature that encompasses the direct value of wild resources to rural households; the extent to which these resources mitigate poverty and inequality; and the importance of the institutional context. The literature is increasingly addressing competing demands on the resource base both to support nearby livelihoods, and to enhance ecosystem services such as biodiversity; and how initiatives such as community-based payments for ecosystem services are changing how people interact with the resource base.

Doing more harm than good? Community based natural resource management and the neglect of local institutions in policy development

Approaches to natural resource management emphasise the importance of involving local people and institutions in order to build capacity, limit costs, and achieve environmental sustainability. Governments worldwide, often encouraged by international donors, have formulated devolution policies and legal instruments that provide an enabling environment for devolved natural resource management. However, implementation of these policies reveals serious challenges. This article explores the effects of limited involvement of local people and institutions in policy development and implementation. An in-depth study of the Forest Policy of Malawi and Village Forest Areas in the Lilongwe district provides an example of externally driven policy development which seeks to promote local management of natural resources. The article argues that policy which has weak ownership by national government and does not adequately consider the complexity of local institutions, together with the effects of previous initiatives on them, can create a cumulative legacy through which destructive resource use practices and social conflict may be reinforced. In short, poorly developed and implemented community based natural resource management policies can do considerably more harm than good. Approaches are needed that enable the policy development process to embed an in-depth understanding of local institutions whilst incorporating flexibility to account for their location-specific nature. This demands further research on policy design to enable rigorous identification of positive and negative institutions and ex-ante exploration of the likely effects of different policy interventions.

Decentralising natural resource governance in Ghana: critical reflections on the artisanal and small-scale mining sector

This paper critically examines the impact of decentralization on contemporary and future governance arrangements in Ghana’s artisanal and small-scale mining (ASM) sector. The sector, while providing valuable employment in rural areas, is beleaguered by environmental and social issues. Proponents of decentralization argue that re-distributing decision-making authority leads to more responsive, transparent and efficient natural resource management. The analysis presented here, however, demonstrates how weak decentralization has exacerbated the complex, conflictual and clandestine nature of local resource politics surrounding ASM. If future decentralization reforms are going to reverse this trend and improve the governance of ASM in Ghana, then facilitating the participation of traditional authorities is imperative. It is argued that doing so requires addressing the reticence regarding the role of chiefs in resource governance; simply ironing out existing technical issues with decentralization reforms is unlikely to improve the social and environmental performance of ASM in the country. In light of the chronic resource management deficiencies in Ghana, epitomized in the ASM sector, fostering frank political debates on resource governance is becoming urgent.

Hierarchical analysis of production efficiency in a coastal trawl fishery

We present, pedagogically, the Bayesian approach to composed error models under alternative, hierarchical characterizations; demonstrate, briefly, the Bayesian approach to model comparison using recent advances in Markov Chain Monte Carlo (MCMC) methods; and illustrate, empirically, the value of these techniques to natural resource economics and coastal fisheries management, in particular. The Bayesian approach to fisheries efficiency analysis is interesting for at least three reasons. First, it is a robust and highly flexible alternative to commonly applied, frequentist procedures, which dominate the literature. Second,the Bayesian approach is extremely simple to implement, requiring only a modest addition to most natural-resource economist tool-kits. Third, despite its attractions, applications of Bayesian methodology in coastal fisheries management are few.

Managing invasive alien species with professional and hobby farmers: insights from ecological-economic modelling

Biosecurity is a great challenge to policy-makers globally. Biosecurity policies aim to either prevent invasions before they occur or to eradicate and/or effectively manage the invasive species and diseases once an invasion has occurred. Such policies have traditionally been directed towards professional producers in natural resource based sectors, including agriculture. Given the wide scope of issues threatened by invasive species and diseases, it is important to account for several types of stakeholders that are involved. We investigate the problem of an invasive insect pest feeding on an agricultural crop with heterogeneous producers: profit-oriented professional farmers and utility-oriented hobby farmers. We start from an ecological-economic model conceptually similar to the one developed by Eiswerth and Johnson [Eiswerth, M.E. and Johnson, W.S., 2002. Managing nonindigenous invasive species: insights from dynamic analysis. Environmental and Resource Economics 23, 319-342.] and extend it in three ways. First, we make explicit the relationship between the invaded state carrying capacity and farmers' planting decisions. Second, we add another producer type into the framework and hence account for the existence of both professional and hobby fanners. Third, we provide a theoretical contribution by discussing two alternative types of equilibria. We also apply the model to an empirical case to extract a number of stylised facts and in particular to assess: a) under which circumstances the invasion is likely to be not controllable; and b) how extending control policies to hobby farmers could affect both types of producers. (C) 2008 Elsevier B.V. All rights reserved.

Seeds of growth? Agricultural productivity and the transitional dynamics of the Ramsey model

A two-sector Ramsey-type model of growth is developed to investigate the relationship between agricultural productivity and economy-wide growth. The framework takes into account the peculiarities of agriculture both in production ( reliance on a fixed natural resource base) and in consumption (life-sustaining role and low income elasticity of food demand). The transitional dynamics of the model establish that when preferences respect Engel's law, the level and growth rate of agricultural productivity influence the speed of capital accumulation. A calibration exercise shows that a small difference in agricultural productivity has drastic implications for the rate and pattern of growth of the economy. Hence, low agricultural productivity can form a bottleneck limiting growth, because high food prices result in a low saving rate.

Bayesian model averaging and identification of structural breaks in time series

Bayesian Model Averaging (BMA) is used for testing for multiple break points in univariate series using conjugate normal-gamma priors. This approach can test for the number of structural breaks and produce posterior probabilities for a break at each point in time. Results are averaged over specifications including: stationary; stationary around trend and unit root models, each containing different types and number of breaks and different lag lengths. The procedures are used to test for structural breaks on 14 annual macroeconomic series and 11 natural resource price series. The results indicate that there are structural breaks in all of the natural resource series and most of the macroeconomic series. Many of the series had multiple breaks. Our findings regarding the existence of unit roots, having allowed for structural breaks in the data, are largely consistent with previous work.

Transitions towards co-management: the process of marine resource management devolution in three east African countries

Communities are increasingly empowered with the ability and responsibility of working with national governments to make decisions about marine resources in decentralized co-management arrangements. This transition toward decentralized management represents a changing governance landscape. This paper explores the transition to decentralisation in marine resource management systems in three East African countries. The paper draws upon expert opinion and literature from both political science and linked social-ecological systems fields to guide exploration of five key governance transition concepts in each country: (1) drivers of change; (2) institutional arrangments; (3 institutional fit; (4) actor interactions; and (5) adaptive management. Key findings are that decentralized management in the region was largely donor-driven and only partly tranferred power to local stakeholders. However, increased accountability created a degree of democracy in regards to natural resource governance that was not previously present. Additionally, increased local-level adaptive management has emerged in most systems and, to date, this experimental management has helped to change resource user's views from metaphysical to more scientific cause-and-effect attribution of changes to resource conditions.

Input usage, output mix and industry deregulation: an analysis of the Australian dairy manufacturing industry

In this paper we estimate a Translog output distance function for a balanced panel of state level data for the Australian dairy processing sector. We estimate a fixed effects specification employing Bayesian methods, with and without the imposition of monotonicity and curvature restrictions. Our results indicate that Tasmania and Victoria are the most technically efficient states with New South Wales being the least efficient. The imposition of theoretical restrictions marginally affects the results especially with respect to estimates of technical change and industry deregulation. Importantly, our bias estimates show changes in both input use and output mix that result from deregulation. Specifically, we find that deregulation has positively biased the production of butter, cheese and powders.

Biosecurity in agriculture: an economic analysis of coexistence of professional and hobby production

One component of biosecurity is protection against invasive alien species, which are one of the most important threats worldwide to native biodiversity and economic profitability in various sectors, including agriculture. However, agricultural producers are not homogeneous. They may have different objectives and priorities, use different technologies, and occupy heterogeneous parcels of land. If the producers differ in terms of their attitude towards invasive pests and the damages they cause, there are probably external effects in the form of pest spread impacts and subsequent damages caused. We study such impacts in the case of two producer types: profit-seeking professional producers and utility-seeking hobby producers. We show that the hobby producer, having first set a breeding ground for the pest, under-invests in pest control. We also discuss potential policy instruments to correct this market failure and highlight the importance of considering different stakeholders and their heterogeneous incentives when designing policies to control invasive alien species.

Do EU direct payments to beef producers belong in the 'blue box'?

In the Uruguay Round Agreement on Agriculture, so-called 'blue box' support measures were exempted from reduction commitments, provided they were delivered under 'production-limiting' programs. Although classified as 'blue box', the EU system of direct payments (DP) to beef farmers imposes 'claim-limiting' restrictions rather than 'production-limiting' restrictions, allowing farmers to keep additional animals over and above the number upon which they are eligible to claim DP. The present paper provides empirical evidence that EU direct payments capitalise into the market prices of male calves and young steers in Ireland. It is also likely that DP capitalises into the prices of beef cows and heifers. Given this capitalisation process, some farmers can obtain 'capitalised' DP on animals produced over and above the 'claim-limiting' restrictions, by selling these animals through auction markets. Thus, 'capitalised' DP probably encourages production over and above the limiting measures.