Today’s Topics

• Why care about economics?

• Understanding goods

• Applying economic methods

Why care about economics?

• Environment → society → economy

• But I’m not an economist… why care?

  • It is a valuable communication tool

    • politicians, other government officials

    • how to allocate limited resources, stakeholders and community members, balancing costs and benefits

• 50% of content in NCWRC summary report related to economics

Understanding Goods

• Characteristic of Goods

  • Non-Rival: one party’s use of the good does not prevent others’ use of that good

    • subscriptions

  • Rival: one party’s use of the good does prevent others’ use of that good

    • physical goods

  • Excludable: It is possible to prevent non-paying consumers from access to that good

    • movie theater

  • Non-Excludable: Non-paying customers cannot be prevented from accessing or using the good

    • prone to overexploitation: tragedy of the commons

    • playgrounds

  • 

  • Private Goods: Exclusive Rival (Food, clothing, land, housing)

  • Club Goods: Exclusive Non-Rival (YMCA, Country Club, Golf course)

  • Common Pool Resources: Non-Exclusive Rival (BLM grazing land, coal and gas deposits)

  • Public Goods: Non-Exclusive non-rival (Public television, municipal parks)

Applying Economic Methods

• Quantitative: generalization, prediction, casual explanation, begins with theory (deductive), uses instruments, experiments, reduces data to numbers

• Qualitative: contextualization, interpreting process, understanding actors’ view, ends with theory (inductive), researcher is the instrument, data is what informants express (language, action)

Market Value

Non-market Value

• 

• Cannot observe transactions in wildlife

• Direct use value, indirect use value, bequest value, existence value

Non-market valuation methods

• Revealed Preference Methods: Travel Cost, Hedonic Pricing, Benefit Transfer

• Stated preference methods: Contingent Valuation (CV), discrete choice experiments

• 

Applying Economic Methods: Case Study Speed Round

• Are hunters/anglers willing to pay for the conservation of public lands?

  • Asking whether they want to pay x amount of dollars on survey

  • Contingent Valuation (CV): using a hypothetical market to reveal what people would be willing to pay for a change in the status quo

  • Other CV examples: how much are you willing to pay for a permit, etc,

• How do we estimate the value of ecosystem services?

  • survey asks how much people want to pay to protect oysters, fisheries, biodiversity, coastal protection

  • Discrete Choice Experiment: participants presented with 2 or more packages and asked to pick the one they prefer (5-6 scenarios)

  • Allows us to see what people most value

• How do we quantify the economic value of vagrant birdwatching events?

  • ask people how much they valued being able to watch a bird never seen on the coast before

• How do conservation areas impact nearby real estate?

  • Hedonic pricing: deriving underlying prices for non-market commodities, distance to an amenity

• How can agencies and local governments balance tradeoffs between land acquisition and local tax revenue?

• How does fish/wildlife recreation contribute to local economies?

  • economic contribution analysis

  • most common technique in fisheries and wildlife is using IMPLAN software, created by FEMA and updated yearly

  • uses input-output modeling to reveal how economic activity rippes through the economy via buy-sell relationships between various economic sectors

• How do agencies measure the impact of new policies?

  • built a model

  • accounted for supply and demand

  • price increase would provide an additional $8 million per year to the WRC