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Applying tradable permits to biodiversity conservation: Effects of space-dependent conservation benefits and cost heterogeneity on habitat allocation

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  • Drechsler, Martin
  • Wätzold, Frank

Abstract

This paper is concerned with the cost-effective allocation of habitat for species under spatio-temporally heterogeneous economic development. To address the dynamic dimension of the problem we consider tradable development rights as the instrument of choice. A particular challenge in applying tradable development rights is that the conservation benefit of an individual habitat patch depends on its spatial relationship with other habitat patches and thus is an emergent rather than a fixed property. We analyse with a conceptual model the spatial and temporal dynamics of habitats in a region under a tradable development rights market that takes spatial interaction of habitats explicitly into account. In our analysis two different outcomes may emerge depending on the levels of spatial interaction and cost heterogeneity: an "ordered" structure where habitat patches are clustered in space and are stable over time, and a "disordered" structure where habitat patches are scattered in space and subject to high turnover of destruction and recreation. A high level of spatial interaction or a low level of cost heterogeneity favours an ordered structure while a low level of spatial interaction or a high level of cost heterogeneity favours a disordered structure.

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  • Drechsler, Martin & Wätzold, Frank, 2009. "Applying tradable permits to biodiversity conservation: Effects of space-dependent conservation benefits and cost heterogeneity on habitat allocation," Ecological Economics, Elsevier, vol. 68(4), pages 1083-1092, February.
    • Handle: RePEc:eee:ecolec:v:68:y:2009:i:4:p:1083-1092
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    1. Surun, Clément & Drechsler, Martin, 2018. "Effectiveness of Tradable Permits for the Conservation of Metacommunities With Two Competing Species," Ecological Economics, Elsevier, vol. 147(C), pages 189-196.
    2. Poudel, Jagdish & Zhang, Daowei & Simon, Benjamin, 2018. "Estimating the demand and supply of conservation banking markets in the United States," Land Use Policy, Elsevier, vol. 79(C), pages 320-325.
    3. Panchalingam, Thadchaigeni & Jones Ritten, Chian & Shogren, Jason F. & Ehmke, Mariah D. & Bastian, Christopher T. & Parkhurst, Gregory M., 2019. "Adding realism to the Agglomeration Bonus: How endogenous land returns affect habitat fragmentation," Ecological Economics, Elsevier, vol. 164(C), pages 1-1.
    4. Kangas, Johanna & Ollikainen, Markku, 2019. "Economic Insights in Ecological Compensations: Market Analysis With an Empirical Application to the Finnish Economy," Ecological Economics, Elsevier, vol. 159(C), pages 54-67.
    5. Paula Bernasconi & Stefan Blumentrath & David N Barton & Graciela M Rusch & Ademar R Romeiro, 2016. "Constraining Forest Certificate’s Market to Improve Cost-Effectiveness of Biodiversity Conservation in São Paulo State, Brazil," PLOS ONE, Public Library of Science, vol. 11(10), pages 1-18, October.
    6. Häusler, Mara-Magdalena & Zabel, Astrid, 2024. "Sites side by side: Can an agglomeration bonus with an adjacency rule connect agri-environmental sites?," Ecological Economics, Elsevier, vol. 224(C).
    7. Drechsler, Martin & Wätzold, Frank & Grimm, Volker, 2022. "The hitchhiker's guide to generic ecological-economic modelling of land-use-based biodiversity conservation policies," Ecological Modelling, Elsevier, vol. 465(C).
    8. Greaker, Mads & Hagem, Cathrine & Skulstad, Andreas, 2024. "Offsetting schemes and ecological taxes for wind power production," Ecological Economics, Elsevier, vol. 224(C).
    9. Levin, Gregor & Jepsen, Martin Rudbeck, 2010. "Abolition of set-aside schemes, associated impacts on habitat structure and modelling of potential effects of cross-farm regulation," Ecological Modelling, Elsevier, vol. 221(22), pages 2728-2737.
    10. Drechsler, Martin & Hartig, Florian, 2011. "Conserving biodiversity with tradable permits under changing conservation costs and habitat restoration time lags," Ecological Economics, Elsevier, vol. 70(3), pages 533-541, January.
    11. Gaaff, Aris & Reinhard, Stijn, 2012. "Incorporating the value of ecological networks into cost–benefit analysis to improve spatially explicit land-use planning," Ecological Economics, Elsevier, vol. 73(C), pages 66-74.
    12. Marie Grimm & Johann Köppel, 2019. "Biodiversity Offset Program Design and Implementation," Sustainability, MDPI, vol. 11(24), pages 1-15, December.
    13. Gregory M. Parkhurst & Jason F. Shogren & Thomas Crocker, 2016. "Tradable Set-Aside Requirements (TSARs): Conserving Spatially Dependent Environmental Amenities," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 63(4), pages 719-744, April.
    14. Elofsson, Katarina & Hiron, Matthew & Kačergytė, Ineta & Pärt, Tomas, 2023. "Ecological compensation of stochastic wetland biodiversity: National or regional policy schemes?," Ecological Economics, Elsevier, vol. 204(PA).
    15. Martin Drechsler, 2022. "On the Cost-Effective Temporal Allocation of Credits in Conservation Offsets when Habitat Restoration Takes Time and is Uncertain," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 82(2), pages 437-459, June.
    16. Drechsler, Martin, 2021. "On the cost-effective temporal allocation of credits in conservation offsets when habitat restoration takes takes time and is uncertain," MPRA Paper 108209, University Library of Munich, Germany.
    17. Xu, Meng & Grant-Muller, Susan, 2016. "Trip mode and travel pattern impacts of a Tradable Credits Scheme: A case study of Beijing," Transport Policy, Elsevier, vol. 47(C), pages 72-83.

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