Conservation, Harvesting and free-market economics

Peter Shaw

USR

Introduction This lecture may seem quite out of place in the

wider sweep of this module.. But bear with me. Today I want to explore the effects that arise

when mixing wild, owner-free biological resources with a cash-based human society.

To cover: Zuckerman’s paradox harvesting theory the tragedy of the commons examples: fisheries, great auks and game

reserves

Zuckerman’s paradox Actually I made this name up,

though the paradox was stated by S. Zuckerman in 1992. It is not widely stated, still less understood!

In essence it states that under a free-market system non-renewable resources tend to be harvested sustainably, while biological resources tend to go extinct.

Zuckerman S (1992). Between Stockholm & Rio. Nature 358, 273-276.

Examples: In the 1970s a report called ‘Limits to growth’ was published,

predicting economic collapse before the millennium due to reserves of oil, copper and other minerals running out. At the time the planet had 20 years supply left of these non-renewables.

In 1992 the world bank reported that these minerals, + others, were cheaper than they had been 20 years previously.

Why? Because free-markets are self limiting. As a resource becomes scarcer its value goes up, so it is worth deeper mines / offshore drilling etc. Minerals don’t go extinct, they just become harder to extract.

Biologically? At the time the Limits to Growth report came out, there was a huge, healthy cod fishery on the Grand banks off Newfoundland. This had been discovered hundreds of years ago, was among the largest fisheries on the planet, and could be harvested sustainably for ever.

The Grand Banks is closed to fishing, and has been for 3 years now - the stocks are exhausted.

WHY??? - this is the subject of today’s lecture.

New Sci. 16/9/95 p. 24 re Grand banks.

Caveat

Many of the examples I will cite come directly from fisheries, because these are the classic example of a harvestable un-owned wild resource.

Bear in mind that the same logic applied to forests, elephants etc. The conclusions generalise.

By the end of the lecture you may want a simple summary about the interaction between ecology and economics. I am not sure that I can give you one!

Harvesting theory - the MSY

To harvest a biological population sustainably you must remove ‘surplus’ organisms. This is fine - all populations produce more offspring than can survive. But how many?

In an ideal world with no limits, offspring are proportional to parents: dN/dt = rN - this is exponential growth

N = number of organisms t = time r = reproductive rate dN = rate of change of N dt = change of time

N

t

Exponential growth.. Is a widely mis-used term. It refers to the state in which

growth occurs proportionate to population size, so takes off very rapidly as population grows. Biological populations do this - for a while….

For humans, if our growth rate remains at present levels: In 500 years we will be shoulder-shoulder on all land masses in 1000 years we will be vertically stacked 1000,000 deep In 2000 years the mountain of people would be around the edge

of our galaxy, expanding at the speed of light! (Dawkins: The Selfish Gene, p 119 in my copy.)

Then it tails off Sooner or later, populations become limited by

food, habitat or others, and growth slows down. There is a limit to the population density that any system can maintain - this is known as the carrying capacity and is usually written as K.

N

time

K

In this region growth is almost exponential

An idealised population growth curve – the logistic curve

The logistic equation There is a simple equation developed to describe this growth - it lies

at the heart of most sustainability models and underlies population dynamics, so is worth knowing about.

You take the basic equation for exponential growth, then introduce a second term which slows growth down as the population approaches the carrying capacity K.

dN/dt = r*N*(1-N/K) [English: rate of growth is proportionate to population size and

inversely related to its distance from the carrying capacity]. Note that when N = K, dN/dt = 0 [The solution to this differential eqn is: N/(K-N) = A*exp(r*t) – you do not need to learn this]

R & K species This leads onto a serious conservation issue, via

the parameters of the logistic eqn. There is a crude division between r & K selected species.

R selected species have a high reproductive rate (r). They arrive early in disturbed areas, explode, then fade away. They tend to be short-lived, small, and effective dispersers. Mice, annual weeds etc.

K selected species have a low r but eventually build up to large stable values of K. They are slow to colonise, slow to breed, tend to be large and long lived. Whales, oak trees, elephants etc. (Also many island endemics).

Which group is more likely to be of concern to conservationists?

annualincrement

0 population size K

Harvesting from a logistic curve

In each case the red line shows the harvest that can be removed from the population while keeping the population level constant - the Sustainable Yield.Note that this peaks in the middle of the curve: When N = K/2, the sustainable yield is greatest. This is the MSY = Maximum sustainable yield.

MSY theory Has underlain fisheries models in many countries

for years. The idea is to maintain the population at 50% of its carrying capacity, so that it grows most strongly and can sustain highest levels of harvesting.

PS - it doesn’t work, at least not in the real world!

Sustainableyield

K/2 K Population size

MSY

Idealised graph of sustainable yield against population size

Reasons why MNSY theory doesn’t work too well in practice: 1: Populations don’t obey the

logistic equation 2: Fishermen harvest money, not

fish.

The logistic equation doesn’t work! It predicts that once a species is reduced from

K to a lower level, that population will always bounce back to K. This is often not true – competitors step in to fill gaps, effectively reducing K.

W. coast USA has many salmon rivers – in one runs a biennial fish, the sockeye salmon. Because of the 2 year life cycle it has isolated odd- and even-year populations. In one river system one year over-fishing combined with drought to wreck the population – it never recovered. To this day there is a large difference between even-year and odd-year populations.

Harvesting money This is where it REALLY goes wrong! The problem is the link between economics and ecology – or

rather the total lack of any. It is straightforward to produce a little economic model based

on catch per unit effort, return per catch, and fixed costs of harvesting to show that – for an economically valuable resource - there is a critical population size N0 below which it is not rational to harvest. Above this population size you will make money.

This critical population size does not depend on the MSY – if N0 <MSY it is “rational” to over-exploit the population.

N0 = Catch per unit effort /(return per unit harvest * catchability)

What N0 does depend on is the economic value of the species. If value is high, it is worth harvesting to very low population levels. The problem is that economic value can change.

In practice, what has happened time and again is that a new fishery is started – large population, easy to harvest, easy money. Extraction starts in earnest, the population declines – but the public get a taste for the new fish and its value goes up. Extraction continues, population declines – but demand holds up so the price goes up. Repeat the cycle until the fishery collapses.

Fishery yieldIdealised graph of a fishery collapse

Fishing effort

Salmon again, this time from Alaska. 1880 commercial fishing began. Most were canned - the resource was seen

as inexhaustible. Peak commercial exploitation was 1936, then declined. 1900: 200 boats, harvesting 15000 salmon each 1950: 1000 boats, only catching 1500 salmon each. Thus more and more men chased fewer and fewer fish - makes no biological

sense, but value of fish rose in real terms by x3. (Salmon are now expensive. Last century workers went on strike in UK because they were fed up with being endlessly fed on salmon).

Why? Ecological madness, but economic sense BECAUSE THE RESOURCE BELONGED TO NO-ONE. If it were privately owned, the owner would protect the stock. As a public resource, if you don’t harvest, someone else will.

Canned salmonAlaska 1880-1975

Nth Pacific sardines1910-1970

£ $ € grow by themselves! Then there is the point that money grows. Honestly, it does. Just

not terribly quickly. Providing you are rich. Invest money – you expect a few % real growth. 1-2% in a savings

AC, maybe >5% in shares (long-term). Hilary Clinton once managed 60% somehow.

Now you are a hypothetical bio-miner, maybe processing whales, elephants, or mahogony. You work out their MSY. Being big slow-growing K species, their MSY is low. The equipment needed to process them is expensive. You make more money by converting the entire resource into cash then investing the cash elsewhere.

Whalers have done these calculations. Sustainable harvesting is not rational. Better to convert the species into a form which grows faster. Exterminate.

The tragedy of the commons This leads onto a little story – half way

between a parable and a paradox, posed by Warren Harding in 1968 This was intended as a rebuttal to the assertion by Adam Smith in 1776 that by acting to maximise one’s own gain, one is guided to promote the public interest by the invisible hand of what is now called market forces.

Hardin W. (1968). The tragedy of the commons. Science 162 1243-1248.

Scenario: a village shares cattle grazing on common land. The population is expanding, and at some stage the cow population hits the carrying capacity of the land. Each user then has a decision: Do I add another cow to my personal herd? This question has 2 components: Benefit to the user. The gain is + 1 cow. Loss of value of cows, because each one is now over-using the total resource.

This is shared by everyone. If the land is at its maximum carrying capacity of K cows, then one cow is added, the new value of each cow reduces – it becomes approximately K/(K+1).

A user with n cows (n<K) will then have a herd of value n*K/(K+1), so loses value equal to n(1-K/(K+1)) = n/(K+1). But if he adds 1 cow, his net worth goes from n*K/(K+1) to (N+1)*K/(K+1). This is larger than N by a factor of (K-N)/(K+1), so that if N<K adding one cow increases his personal wealth despite impoverishing the entire community. (Note: if N=K there is no net benefit).

The essence here is that when a common resource is degraded, everyone bears the cost while one individual reaps the benefits.

The herdsman is locked into a system which requires him to destroy the environment in order to compete. This is the tragedy of the commons. Other examples:

Fishery collapses. Fishermen over-exploit because it maximises their personal wealth – if they don’t fish, someone else will take their catch.

When pollution spoils the environment, we all share the cost – but the polluter alone reaps the benefit.

This process of externalising costs is ubiquitous and often well hidden. We all pay for the health care of those whose lungs are damaged by PM10s from diesels. [Heading off-target here, but think about it..]

"If farmers treated land like some fishermen treat the seas we would go hungry" Radio 4 programmeabout poached fish, 1992

Implications / predictions?

A theory should always be tested. TotC predicts that over-exploitation of

communal resources should be the norm, while individual resources are managed sustainably. Over-fishing IS the norm!! Human societies routinely clear habitats. Domestic animals never (?) go extinct.

(Possible exceptions: giant ground sloth Glyptodon in South America?).

Examples of over-harvesting leading to extinction

Sadly there is quite a list of possible candidates here (though orders of magnitude lower than the number of species lost by alien introduction to remote islands).

The passenger pigeon used to be the most numerous bird on the planet, covering north America with flocks that took days to pass over. It was harvested commercially – Martha the last specimen, died in Pennsylvania zoo 1879.

Another sad story I want to examine is the great auk.

Great AukAlca impennis

Variously known as garefowl or penguin (from Cornish for “white head”), this flightless auk was found around the northern Atlantic. Its pictures were painted in the Grotte Cosquer in the Mediterranean c. 20,000 BP.

It was only harvestable on its nesting grounds – offshore islands, where thousands of birds nested together. Sadly, thousands of large, oil-rich, tasty flightless birds gathered together to lay eggs proved to be just too tempting.

Europe.. Had exterminated all its great auk colonies by

1697, except one on the tiny island of St Kilda. The last bird here was trapped by the locals who accused it of being a witch, and beat it to death in 1840.

St Kilda, high street1840

America Had huge auk colonies on its “funk islands” off

the eastern seaboard – auks shoulder to shoulder for miles. Marine charts noted their location as the din could be heard for miles and was useful for navigating in mist.

These were close to where trans-Atlantic ships landed, and were ruthlessly harvested for fresh meat and eggs. Conveniently, the great auk’s stomach is just big enough to hold the fat rendered down of the birds body. Fat-filled stomachs fetched money as fuel for lighting.

The cruelty and wastefulness of these harvests was barbaric - it was an unregulated free resource.

The last east-coast rookery went extinct in 1802.

The last population of Great Auks lived off Iceland. Up to 1800s they nested on an inaccessible volcanic island Geirfuglaske, but this was the centre of an eruption in 1830, and the birds moved to the relatively more accessible island of Eldey.

Then a merchant called Siemson realised that auks had a significant market value, and made money by killing and stuffing birds from Eldey.

By 1843 he had killed and sold 75. The last pair, a male and female, were killed by being clubbed on Monday 3 June 1844. The species was extinct.

Note the ratchet effect here – as birds became scarce their value increased, so they were more worth hunting.

Eldey – on a calm day

Prohibition or capitalism? Jumping away from Iceland to the plains of Africa, we have other economically

valuable, K selected animals. A Rhino’s horn is worth its weight in gold, literally. The value of ivory on a large elephant might be 10 years wages for an African.

All big game has suffered from hunting, but the particular problem is with poachers armed with high-powered assault rifles. All 5 Rhinoceros species are endangered (Javan and Sumatran <100 animals).

Game parks have traditionally worked on the principal that hunting is utterly prohibited. This leads to extensive criminalisation of locals, who resent the external imposition.

Worse: elephants cause huge crop damage – imagine your year’s harvest wiped away in 1 night.

There is a new scheme known as CAMPFIRE in which game hunters are encouraged to pay for hunting. Locals decide how many animals to kill, and retain profits locally. In a sense, they OWN the animals – the way forward?