Ecosystem Valuation: A step forward?

Dr. Adhikari provided an exceptionally thorough analysis of key terms and theories on economic valuation, which proved insightful and eye-opening to someone with little economics background.

“How valuable is an ecosystem?” and “to whom?”[1] are core questions to ask from an economics perspective, when thinking of possible ways to increase awareness of decision-makers around the protection of ecosystems. In instances where there are negative externalities resulting from the productive or consumptive activities that inflict involuntary costs on others, the generators of externalities only consider private costs of the economic activity and ignore the social costs they place on others.  The receivers of the service or good (or natural resource in the context of water) incur these social costs in the form of health problems or clean-up costs.

Seeing that water was discussed as having an inefficient and uncompetitive market (no Pareto efficient-meaning it cannot be reallocated to one party without making another party worse off), with a low social surplus, and users prefer to ‘free-ride’ on the provision of this good (tragedy of the commons), it becomes quite difficult to control or to place a value on it.

Various measures were presented to resolve the dilemma including voluntary provisions (i.e tax incentives, reward conservation behaviours), market-oriented measures (i.e cap and trade) and state “command-and-control” mechanisms. Three systems in particular caught my attention:

1) PES (payment for environmental systems)- private payments. This system entails that those downstream pay upstream parties to conserve or preserve the resource.  The idea is that the payment will act as an incentive for those upstream to change their behaviour from exploitation to conservation.

My question concerning its effectiveness is: how can one guarantee that those upstream will in fact change their behaviour or even want to in every case (even with an incentive)? 

Moreover, how equitable is it to make those who are the “victims” in this scenario, pay an additional price for the sake of conserving the resource, while those exploiting the resource get incentives? From an economics perspective this may be seen as a win-win situation, however, moral questions arise when those downstream cannot afford to pay the cost/incentive to change the upstream party's behaviour. How can their dilemma be resolved?


2) Government monitoring. This system requires greater government control by setting legal mechanisms (i.e fines and taxes) to control exploitation of the resource.

Although this system seemed the most convincing to me at the time, Dr. Adhikari soon clarified for me the issues. At times, the cost of compliance can be too high and there is no incentive for governments to implement legal mechanisms. For one reason, there may be political corruption which will falter the system even if it is created, and secondly, governments may fear stifling production by adopting such measures.

3) Public Payments. I found this system to be rather reasonable but certainly not without its caveats. In this system, governments pay entities (such as farmers, NGOs) to conserve particular ecosystems. This has been taking place in countries like Ecuador (where municipal water and electrical utility companies each donate 1% of water revenues for watershed protection), and in Costa Rica among other places. Although this system contributes to the conservation initiatives of certain ecosystems, does it limit or prevent the exploitation of the resource at the level of consumption? 

On this note, water governance is a complex and controversial issue. However, if water can be valuated, then perhaps this will increase its appreciation and conservation. A final question which merits further research on my part is: if water were to be at some point valuated, and a price were to be set, would that be more conducive to changing individuals' or companies’ exploitative behaviour- or would it present an opportunity for private interests to monolopolize the market supply for water, now that a price has been set for it (and a market has been created)? 

* I plan to post a blog over the break regarding water laws in Kenya in preparation for our February trip- stay tuned for that! 

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[1] How Much is an Ecosystem Worth? Assessing the Economic Value of Conservation. The World Bank/IUCN/The Nature Conservancy. IBRD/World Bank, Washington DC, 2004.

A gendered approach to water-sanitation projects.

Much research has proven that water problems and sanitation problems are closely interlinked yet their relationship is most often disregarded. As Dr. Elliot explained, the Cholera outbreak in 19th century England was not linked to water contamination until John Snow plotted a cholera map and realized the concentration of cases was around a particular well in the city. Similarly today, it is not well acknowledged that approximately 10% of the global health burden is affected by water.*

Solutions provided at the macro level may not be very successful due to the specificity and variety of perceptions on sanitation at a micro-level such as attitudes, practices and risk perception, the psychosocial impacts of other problems, the levels of social cohesion, and most importantly gender roles.  

If community members are not willing to use latrines, then why bother build them?

I would like to, however, dedicate this blog to highlight the gendered face of water-health problems. There is more relevance to addressing gender equity in water-related management than is generally discussed. Although there was a section devoted to exploring women’s role in Safe Water as the Key to Global Health (2008)- an effort which is commended- it was too brief.* This area of research warrants further investigation. Women bear the burden of a majority of household chores that necessitate water use (cooking, cleaning, washing laundry, walking for miles to fill up containers). They also carry the heavier burden of tending to their ill children and family members who get infected with diseases that are waterborne. Despite their customary higher contact with water, they tend to be marginalized in decision-making around improving water and health standards.  As Dr. Wallace explained, asking the men within a community for their solutions yields a completely different set of answers than that of women’s. Yet within communities built on patriarchal norms, it is expected that the men's decisions be considered.

This is why encouraging greater gender engagement in addressing water problems and explaining to women within a community how their burden can be lessened as a result, will most likely foster greater support for water and sanitation projects.

My impression is that due to the taboos around the subject of bodily wastes, sanitation has been sidelined, both as a topic of conversation and an investment priority. "In Deep Democracy: Urban Governmentality and the Horizon of Politics", Arjun Appadurai explores the work of the Alliance, an NGO based in Mumbai which allows slum dwellers to work together to improve their standards of living. One example that caught my attention was celebrating "toilet festivals" (32).** The main idea is to redeem humiliation through a politics of recognition. Celebrating a toilet will rid it of the stigma associated with it. Initiatives like "toilet festivals" and encouraging increased female participation, mothers and young girls, can be one way to increase the success of water-sanitation projects and to achieve a sustainable community-based solution. 

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* Corinne J. Schuster-Wallace, Velma I. Grover, Zafar Adeel, Ulisses Confalonieri, Susan Elliott , “Safe Water as the Key to Global Health” (2008), pp.10

http://www.inweh.unu.edu/documents/SafeWater_Web_version.pdf  

** Arjun Appadurai, "Deep Democracy: Urban Governmentality and the Horizon of Politics". Public Culture. 14, 1 (2002), pp 21-47.

*** Brodie Morgan Ramin and Anthony J. McMichael, "Climate Change and Health in Sub-Saharan Africa: A Case-Based Perspective", EcoHealth 6 (2009), pp 52–57. 

I very much enjoyed the case-specific approach used in this article selected by Dr. Wallace and Dr. Elliot for their presentation. The use of the affected individuals’ names as titles for the case studies permits focusing importance on the human suffering caused by changing environmental conditions, and water was an indirect- sometimes even direct- factor, whether due to a flood, dehydration, drought, mal-nourishment etc. It is worth noting that most of the cases were reported by women.

Institutionalizing the problem.

It is always the same question that reiterates: how should we approach the issue?

In order not be redundant, I will analyze the water crisis from a top-down approach, since I had previously explored it from a bottom-up stance in Blog # 3 (focusing on endogenous community based solutions).

In the presentation on UNU-INWEH, Dr. Zafar Adeel explained that approaches to the water crisis have consisted of institutional (i.e AMCOW), economic (i.e. ODA) and/or public responses.

In my opinion, the biggest challenge has been the institutionalization of the problem- the intense focusing on large institutions to collaborate initiative and agree on common terms to bring forth a practical, result-based solution. Although an institutional, top-down approach is a critical factor to the equation, as it is the largest source of funding, this approach has been constricted with bureaucracy, confined among experts and at a point lost trajectory of focusing on the most in need of assistance.

As discussed by Dr. Adeel in the presentation, many institutional initiatives, which also determine where economic solutions are directed, have lost focus on the pressing targets. ODA(overseas development aid) for instance, has been targetted towards large scale systems rather than small, more manageable and effective projects, and its distribution towards water issues has been decreasing in the first place. UNU-INWEH has been playing a role in trying to redirect focus back to funding numerous dispersed small-scale initiatives, rather than a few larger scale ones that marginalize many communities in need of assistance.

The role of national and international institutions in setting laws and regulation for the water crisis is pivotal, however, self-criticism is of the essence. Unless one recognizes and acknowledges their own problems, how can they effectively solve the world's problems?

In Lederach's "A Framework for Building Peace", he outlines 3 essential pillars for action:

1) education

2) advocacy

3) mediation

Although Laderach uses his theory in the context of peace-building, it continues to be relevant here as it calls for methodological change to achieve social change. My interpretation of these three pillars around the water crisis rests in 1) promoting education on the issue of water to both local communities and international actors while developing short-term and long-term plans* 2) using adequate language to frame the issue within the boundaries of reality and urgency** 3) understanding value paradoxes (opposing ideas) which represent sides to the same problem.

Perhaps institutions involved in the top-down approach to addressing the water crisis need to adopt Laderach's model- a more encompassing framework, that accepts differences and leaves room for ecouraging endogenous bottom-up solutions.

Can this self-reflexive and more encompassing top-down approach effectively resolve the problem of institutionalizing the problem?

* as discussed at the GECHH 2010 symposium by Dr. Karanja- it is important to identify "gaps" in current knowledge on water issues- i.e evidence gathering, role of women etc.

** as discussed at the GECHH 2010 symposium by Dr Mark Rosenberg on "reframing" discourse- i.e shifting the focus from protecting the "quality" of water as if, as humans, we are separate from it. 

Citation: Lederach; John Paul. "A Framework for Building Peace" chapter 2. in Preparing for Peace: Conflict Transformation Across Cultures. New York: Syracuse University Press, 1995, pp 3-23.