Can globalisation result in less efficient and more vulnerable industries?

Growing economic globalisation (a means of market extension) may increase the economic vulnerability of firms in modern industries, especially those in which firms experience substantial economies of scale. The possibility is explored that globalisation activates competitive pressures that forces firms into a situation where their leverage (fixed costs relative to variable costs, or overhead cost relative to operating costs or capital intensity) rises substantially. Consequently, they become increasingly vulnerable to a sudden adverse change in economic conditions, such as a collapse in the demand for their industry’s product. This is explored for monopolistically competitive markets and also for oligopolistic markets of the type considered and modelled by Sweezy using kinked demand curves. In addition, globalisation is hypothesised to induce firms to become more uniformly efficient. While this has static efficiency advantages, this lack of heterogeneity in productive efficiency of firms can make for economic inefficiency in the adjustment of the industry to altered economic conditions. It is shown that lack of variation in the economic efficiency of firms can impede the speed of market adjustment to new equilibria and may destabilise market equilibria.

Tourism as a contributor to development in Sri Lanka: An overview and a case study

General background is provided on the potential of tourism growth to contribute to economic development, paying particular attention to the experience of Sri Lanka. An overview of trends in inbound tourism to Sri Lanka is presented with particular consideration being given to its number of inbound tourist arrivals. Sri Lanka’s comparative position in international tourism markets, the composition of its tourist arrivals by area of origin, the extent of foreign earnings by the Sri Lankan tourism industry and variations in the amount of these earnings, and the extent of employment generation by this industry are examined. Regional aspects of the tourism industry in Sri Lanka are given special consideration, and this is followed by a report on the regional economic impact of tourism of Pinnawala Elephant Orphanage. This major tourist attraction near the edge of the Western Highlands of Sri Lanka is shown to make a significant contribution to economic decentralisation. A general discussion follows of tourism development in the Sri Lankan context. The main factors that have hindered tourism growth in Sri Lanka and its decentralisation are considered. Indications are that major impediment posed by civil disturbance and terrorism is at an end in Sri Lanka.

Birds - their importance to visitors to an Australian rainforest

Lamington National Park in Queensland, Australia is noted for its rainforest and is part of Australia’s fourteen World Heritage listed properties but no systematic study has been done of the importance of birds to its visitors. This study rectifies this situation. It is based on data from survey forms handed to visitors at an important site in this park and completed by visitors following their visit. This yielded 622 useable replies. These enabled us to establish the comparative importance of birds as an attraction to this site. Furthermore, logit regression is used to analyze and to identify factors that increase the likelihood of a visitor saying that birds are an important attraction. In addition, the relative importance to visitors of various attributes of birds at this site is established. These attributes include hearing birds, diversity of birds, seeing lots of birds, presence of rare birds, presence of brightly colored birds and physical contact with birds. Logit regression analysis is used to isolate independent variables that increase or decrease the likelihood that visitors find diversity of birds, brightly colored birds or physical contact with birds at this site to be important. For example, factors such as the level of education of visitors, their gender, knowledge of birds and conservation attitudes are statistically significant influences.

Knowledge and willingness to pay for the conservation of wildlife species: Experimental results evaluating Australian tropical species

The nature of an experiment involving 204 residents is outlined and the results are reported and analysed. Two consecutive surveys of the respondents provide data about their stated knowledge of 23 wildlife species present in tropical Australia, most of which exclusively occur there. In addition, these surveys provide data about the willingness of respondents to pay for the conservation of those species belonging to three taxa; reptiles, mammals, and birds. Thus it is possible to compare the respondents’ stated knowledge of the species with their willingness to pay for their conservation, and to draw relevant inferences from this. From the initial survey and these associations, interesting relationships can be observed between those variables (knowledge and willingness to pay). The second survey was completed after the respondents’ knowledge of the species was experimentally increased and became more balanced. This is shown to result in increased dispersion (greater discrimination) in willingness to contribute to conservation of the different species in the set of wildlife species considered. Both theoretical and policy conclusions are drawn from the results.

Birds in an Australian rainforest: Their attraction for visitors and visitors' ecological impacts

Lamington National Park in Queensland, Australia is noted for its rainforest and is part of the World Heritage listed property but prior to this work, no systematic study has been done of the importance of birds to its visitors. This study is based on data from survey forms handed to visitors at an important site in the park and completed by visitors following their visit. It yielded 622 useable responses. These enabled us to establish the comparative importance of birds as an attraction to this site for this sample of visitors. Furthermore, logit regression is used to target analysis and to identify factors that increase the likelihood of a visitor saying that birds are an important attraction. In addition, the relative importance to visitors of various attributes of birds at this site is established. These attributes include hearing birds, diversity of birds, seeing lots of birds, presence of rare birds, presence of brightly coloured birds and physical contact with birds. Logit regression analysis is used to isolate independent variables that increase or decrease the likelihood that visitors find diversity of birds, brightly coloured birds or physical contact with birds at this site to be important. For example, factors such as the level of education of visitors, their gender, knowledge of birds and conservation attitudes and statistically significant influences. As a result of the analysis potential conflicts between different types of park visitors in relation to human interaction with birds are identified. Some potential ecological implications of human interactions with birds are modelled and discussed, and their economic conservation and biodiversity consequences are considered

Information and wildlife valuation: Experiments and policy

The authors use experimental surveys to investigate the association between individuals' knowledge of particular wildlife species and their stated willingness to allocate funds to conserve each. The nature of variations in these allocations between species (e.g., their dispersion) as participants' knowledge increases is examined. Factors influencing these changes are suggested. Willingness-to-pay allocations are found not to measure the economic value of species, but are shown to be policy relevant. The results indicate that poorly known species, e.g., in remote areas, may obtain relatively less conservation support than they deserve.

Antarctic tourists: A case study of their evaluation of Antarctic wildlife and environmental issues

Reports the results of surveys of Antarctic cruise ship passengers on the ‘Akademik Ioffe’ who undertook their Antarctic journey in January 2003. The prime purposes of the surveys were to determine the socio-economic profile of these travellers, evaluate the importance of Antarctic wildlife for their travel, their attitude to Antarctic wildlife conservation as well as environmental issues involving Antarctica, both prior to their tourist visit to Antarctica and following it. This paper reports on the socio-economic profile of respondents, their willingness to pay for their Antarctic trip, and their knowledge of Antarctica. The comparative importance of Antarctic wildlife as a factor motivating respondents to undertake their journey is assessed and the evaluation of travellers following their Antarctic visit is considered. The relative importance of different Antarctic wildlife species is taken into account as well as Antarctic attractions other than wildlife. The attitudes of respondents to several environmental issues involving Antarctica, (eg. the commercial use of its natural resources and global environmental change impacting on Antarctica) are canvassed and summarised. In conclusion, the relevance of the survey results for Antarctic conservation are discussed. Particular attention is given to the question of whether Antarctic tourism favours or threatens Antarctic nature conservation.

An initial assessment of policies for saving a rare Australian glider: Experimental results, economics and ecology

Reviews the ecological status of the mahogany glider and describes its distribution, habitat and abundance, life history and threats to it. Three serial surveys of Brisbane residents provide data on the knowledge of respondents about the mahogany glider. The results provide information about the attitudes of respondents to the mahogany glider, to its conservation and relevant public policies and about variations in these factors as the knowledge of participants of the mahogany glider alters. Similarly data is provided and analysed about the willingness to pay of respondents to conserve the mahogany glider. Population viability analysis is applied to estimate the required habitat area for a minimum viable population of the mahogany glider to ensure at least a 95% probability of its survival for 100 years. Places are identified in Queensland where the requisite minimum area of critical habitat can be conserved. Using the survey results as a basis, the likely willingness of groups of Australians to pay for the conservation of the mahogany glider is estimated and consequently their willingness to pay for the minimum required area of its habitat. Methods for estimating the cost of protecting this habitat are outlined. Australia-wide benefits seem to exceed the costs. Establishing a national park containing the minimum viable population of the mahogany glider is an appealing management option. This would also be beneficial in conserving other endangered wildlife species. Therefore, additional economic benefits to those estimated on account of the mahogany glider itself can be obtained.

Comparative public support for conserving reptile species is high: Australian evidence and its implications

This paper investigates factors influencing the public’s support for conservation of tropical reptile species in a focal group drawing on Australian data and an experiment involving a sample of the Australian public. The influences of the likeability of the species, their degree of endangerment, ethical considerations as well as knowledge are examined and found to be important. Likeability is found to be much less important than the existing literature suggests. This is highlighted by comparing the likeability of the focal group of reptiles with that for a group of birds and a group of mammals with differences in willingness to pay for their conservation.

Dependence of public support for survival of wildlife species on their likeability

We surveyed a sample of 204 individuals selected from the public in Brisbane, Australia, to ascertain the extent to which they like or dislike 24 species of wildlife present in tropical Australia. The species belong to three classes: mammals, birds and reptiles. We calculated likeability indices for each of these species. We also asked respondents if they favoured the survival of each of these species and so the percentage of respondents favouring survival of each of these species could be calculated. Thus, using linear regression analysis, the percentage of respondents favouring survival of each of the species was related to their indices of likeability. In addition, the data enables the average likeability of species in the three classes (mammals, birds and reptiles) to be compared with the average support for survival of species in each of these three classes. As a result, we are able to assess how important stated likeability seems to be for preferences for survival of species, and to reconsider the hypothesis in the literature that there is likely to be more public support for the survival of mammals than for birds than for reptiles.

Knowledge of birds and willingness to pay for their conservation: An Australian case study

This case study concentrates on the extent of knowledge of members of the Australian public of Australia’s tropical bird species and their willingness to pay for their conservation. In order to place this issue in context, it first provides background information on the status of Australian bird species, focusing attention on species that occur in tropical Australia. Then, using survey results, this study considers the hypothesis that the public’s relative support for the conservation of different bird species depends on its comparative knowledge of their existence and status. Based on experimental results from a sample of residents of Brisbane, Queensland (Australia), it is found that their knowledge of bird species that occur exclusively in the Australian tropics (including tropical Queensland) is very poor compared to those that also occur in the Brisbane area and are relatively common. Experimental results indicate that when respondents in the sample had an option to allocate $1,000 between ten bird species listed in the survey, it resulted in a greater allocation of funds to the better known and more common species than when they were provided with balanced information about all the selected species. With balanced information the average allocation to bird species confined mostly to the Australian tropics, particularly those threatened or endangered, increased. The general consequences of this for policies for the conservation of birds are discussed.

A model of seller holdout

We model a buyer who wishes to combine objects owned by two separate sellers in order to realize higher value. Sellers are able to avoid entering into negotiations with the buyer, so that the order in which they negotiate is endogenous. Holdout occurs if at least one of the sellers is not present in the first round of negotiations. We demonstrate that complementarity of the buyer's technology is a necessary condition for equilibrium holdout. Moreover, a rise in complementarity leads to an increased likelihood of holdout, and an increased efficiency loss. Applications include patents, the land assembly problem, and mergers.

Binary games with many players

We examine a problem with n players each facing the same binary choice. One choice is superior to the other. The simple assumption of competition - that an individual's payoff falls with a rise in the number of players making the same choice, guarantees the existence of a unique symmetric equilibrium (involving mixed strategies). As n increases, there are two opposing effects. First, events in the middle of the distribution - where a player finds itself having made the same choice as many others - become more likely, but the payoffs in these events fall. In opposition, events in the tails of the distribution - where a player finds itself having made the same choice as few others - become less likely, but the payoffs in these events remain high. We provide a sufficient condition (strong competition) under which an increase in the number of players leads to a reduction in the equilibrium probability that the superior choice is made.