Agriculture production versus biodiversity protection: The impact of North-South unconditional transfers

Stéphanie Aulong, Charles Figuieres and Sophie Thoyer ()
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Stéphanie Aulong: BRGM - Bureau de Recherches Géologiques et Minières

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Abstract: The purpose of this paper is to explore whether international income transfers can improve or worsen the global level of biodiversity and global social welfare by changing the relative contributions to biodiversity protection and to agricultural production. Because of the public good nature of biodiversity, Warr's neutrality theorem suggests that such transfers may have no effects at all (Warr, 1983). A model is developed, based on the simplifying assumption that northern countries have little biodiversity whereas southern countries are endowed with natural capital in the form of (generally unspoilt) biodiversity-rich land. Southern countries allocate optimally land and capital to two competing productive activities, agriculture and eco-tourism. When transfers are organized from the North to the South, we show that Warr's neutrality theorem collapses. Transfers can either reduce or increase the natural capital in the South, depending on some empirically verifiable hypotheses concerning the characteristics of the eco-tourism and agricultural production functions. In addition, we demonstrate that welfare improvements can be obtained even with reductions in the level of biodiversity. Research Highlights Could international income transfers improve the levels of biodiversity and welfare? A model is developed with a biodiversity-poor North and an ecosystem-rich South. We show that North-South transfers can either reduce or increase the natural capital. And that welfare improvements can be obtained even with reductions in biodiversity.

Keywords: Biodiversity; Agriculture; Conservation policy; North-South income transfers; Voluntary contribution; Public good; Neutrality theorem; Kuznets' environmental curve (search for similar items in EconPapers)
Date: 2011-06-15
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Published in Ecological Economics, 2011, 70 (8), pp.1499-1507. ⟨10.1016/j.ecolecon.2011.03.011⟩

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Journal Article: Agriculture production versus biodiversity protection: The impact of North-South unconditional transfers (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-00601787

DOI: 10.1016/j.ecolecon.2011.03.011

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