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Monday, September 13, 2010

PlanetMoney: The Pelican Bill

So, Planetmoney did an interesting post on July 30th, about the environmental costs of the BP spill.  It's an interesting piece.  As we've discussed environmental costs are not included in GDP.  One of the reasons for this is because its difficult to effectively cost the effects on the environment.

In this case, they decided to price a pelican.  In point of fact, a much more valuable way to have done it was to tally up the price of shrimp in the Gulf of Mexico, but hey, I guess they wanted something that was more esoteric in value.

There first stop was to a bird lover, who paid up to $500 for a Pelican.  One of the hosts scoffed at this, saying that what a rare bird collector and preservationist would pay isn't the best estimate.  The second stop was Hollywood.  Hollywood, being in the business of accurately fabricating real life, rents pelicans.  That price was even higher, at $4,500 a day.

But here's where it gets interesting.  They talked to Gardner Brown, of the University of Washington, about his work valuing a wild duck.  This theory, called contingent valuation makes some interesting points:  1)  Nature is a public resource, ostensibly, we are ALL owners.  So while, we may not value a pelican particularly highly, maybe a few cents, in aggregate, the value of that pelican can be quite high.  Also, and this is the reason for this post, Brown, whose work was done for licensing and wildlife hunting issues, would go up to hunters and ask what price would they pay for one more duck.  One of the planetmoney hosts again scoffed at this, implying that hunters aren't necessarily experts, or that they wouldn't necessarily be honest.  He further stated that a survey isn't the same as a live market.  While these are good questions, I think a really obvious point would be that:

If my government were really interested in conservation, then they would pay hunters to stop hunting.  Recognizing that hunting is the source of their livelihood, the price of a duck is the hunters gross income.  It's not preferable, for obvious reasons, I mean, you'd have to be able to prove that this was your only source of income, and then what?  You would get paid to sit around all day?  This isn't a big problem in North America, but in the African bush, it's a very big problem.  In fact, AIDS was probably loosed on the world through a very similar transmission, people hunting and eating infected chimpanzees.  Bush meat is very popular in developing countries.  Not only is it cheaper than going to the market, there is also a blackmarket value for interesting animal parts.  Completely aside from the blackmarket value, is the superstitious value of eating gorilla balls for virility.

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