Tragedy of the Zimbabwe commons

From Marginal revolution.

A must read for Environmental Economics students.

See the Tragedy of the Commons [Marginal revolution]

In 2000 Zimbabwe began to forcibly redistribute land from private but predominantly white-owned commercial farms to much poorer black farmers who toiled on communal lands. Stunning pictures from Google Earth collected by Craig Richardson show the result.

Take a look at the Before picture. The communal land on the left is dry, dusty and unproductive compared to the private farmland on the right which is green and dotted with blue ponds and lakes. Why? There were two theories to explain this difference.

* The Tragedy of the Commons – the farmers on the communal lands did not have the incentives to invest in the land and thus the land eroded and turned to desert.

* The land on the right (which was owned mostly by whites) was better quality land.

Both theories could be true. Regarding the latter explanation, however, notice that the dry communal lands on the left are sharply delineated from the green private farms on the right--so sharply that soil quality and rainfall alone are unlikely to explain the difference.

So what happened after the land was redistributed beginning in 2000 and all of it made communal?

After reform the land quality worsened everywhere. In particular, note that the blue lakes and ponds on the right became dry and empty as farmers no longer had an incentive to invest in maintaining these resources. The tragedy of the commons.

This excellent visual look at the tragedy of the commons was produced by Todd Moss at The Center for Global Development based on pictures and ideas from Craig Richardson. Of course Zimbabwe had many problems before and after this forcible land redistribution. You can find more pictures, background information and a lengthier discussion of this episode here.

In addition, I have included the shifting graphic in a set of PowerPoint slides which could be incorporated in a classroom discussion of the tragedy of the commons. Feel free to modify these slides as you wish and thanks to the Center for Global Development for helping me to create the slides.

This post is an example of the material available at a new website designed for anyone teaching principles of economics and called, SeetheInvisibleHandBlog. At the new website you can can find videos, powerpoints, ideas, blog posts and much more. The material is nicely linked up with our textbook, Modern Principles, but we think that this website will be useful to anyone who teaches principles of economics.

Aral Sea: Man made ecological disaster

Reporting on ecological disasters is always a favourite topic of this blog and the Aral Sea is no exception so much so that PlanetArk has deemed it newsworthy enough to grant it "FACTBOX" status.

The broader issue is to consider how these facts will translate across the globe in the coming decades.

One important point is that these disasters are not solely "climate change" induced but more broadly related to poor management and issues related to the "tragedy of the commons".

Key Facts About the Disappearing Aral Sea [PlanetArk]

The Aral Sea, once the world's fourth largest lake, has shrunk by 70 percent in recent decades in what environmentalists describe as one of the worst man-made ecological disasters.

Lakes and seas are disappearing around the world, partly as a result of global warming but mainly due to mismanagement of water resources linked to irrigation projects.

Other endangered sites include Central Asia's second-largest lake, Balkhash, as well Lake Chad in Africa and Lake Qinghai, China's largest expanse of inland water.

Below are key facts about the Aral Sea.

* Fifty years ago, the Aral Sea was the world's fourth inland sea, after the Caspian Sea, Lake Superior and Lake Victoria. It started shrinking due to Soviet irrigation projects, its surface area declining by more than 50 percent, to 30,000 square km from 67,000 square km, between 1960 and 1996. The sea level dropped by 16 metres, according to the World Bank.

* The sea straddles the former Soviet Central Asian republics of Kazakhstan and Uzbekistan. It split into a large southern Uzbek part and a smaller Kazakh portion in 1990.

* Central Asia, one of the world's driest regions, has two main rivers, the Syr Darya and the Amu Darya. Both used to feed the Aral Sea. In the 1960s Soviet planners built a network of irrigation canals to divert their waters into cotton fields in Uzbekistan and Turkmenistan, starving the sea of its life blood.

* Mismanagement of land and water resources has caused degradation extending to the entire Aral Sea basin, damaging fish production and causing high salinity and pollution as well as violent sand storms. Fresh water supplies have diminished and human health problems have risen, according to the World Bank.

* Kazakhstan pledged to restore its portion of the Aral Sea when it gained independence from the Soviet Union in 1991.

The Aral Sea region is among the poorest in the oil producing state. At least a quarter of its population lives below the poverty line, and the average monthly income is three times below that of Kazakh financial capital Almaty, according to official data. Average life expectancy is 66 years compared to 70 in Almaty.

* The first phase of a World Bank restoration project is due to be completed at the end of 2008. Total cost is US$86 million, including a US$64.5 million World Bank loan to the Kazakh government.

The aim is to secure the northern Kazakh pocket of the Aral Sea at 42 metres above Baltic Sea level and improve ecological conditions in the area. The project includes construction of the Kok-Aral dike which separates the northern sea from the southern part, and several hydraulic structures on the Syr Darya river.

* The World Bank is considering a follow-up project to improve environmental and economic conditions further, a scheme estimated to cost US$300 million. It includes returning water to the port of Aralsk and nearby villages, rehabilitating delta lakes and improving river flows.

* Similar efforts have been impossible in Uzbekistan, where most river water is still directed to cotton production -- one of the main pillars of the Uzbek economy. The south part continues to shrink. Experts, including the World Bank, doubt the Aral Sea will be ever restored to its original size. (Editing by Catherine Evans)

.

Bluefin given a lifeline instead of a fishingline

As part of our economics of fisheries series comes news that the Bluefin tuna might live to fight another day but how many more is hard to predict.

The economics are as always fascinating. What happens when demand increases and the supply falls, of course the price increases - in this case tripling in a year where a SINGLE fish can cost $100,000. Now, what happens when the price rises so dramatically? More fisherman try and catch the remaining few fish. Obviously the fisherman will weigh up the costs of trying to catch the last few fish (fuel, time, opportunity cost etc.) against the price but as long as the price continues to rise this quickly it is not a great time to be a tuna.

This is a classic tragedy of the commons disaster unfolding before our eyes.

EU to Ban Med Bluefin Tuna Fishing From Next Week [PlanetArk]

BRUSSELS - EU fisheries regulators have banned trawling for bluefin tuna from next week in the eastern Atlantic and Mediterranean to stop overfishing of a species that is approaching stock collapse, the EU executive said on Friday.

Bluefin tuna is prized by sushi lovers and its numbers have fallen due to overfishing by countries hunting it in those waters -- Cyprus, France, Greece, Italy, Malta, Portugal and Spain.

Last year, their combined national fleets caused the EU to exceed its international catch quota by 25 percent. Scientists say bluefin tuna may die out if fishing is not restricted.

But the incentive to catch bluefin tuna remains strong, particularly in June, when around 85 percent of the fish are caught. Since last year, market prices for the delicacy have roughly tripled: in Japan a single fish can cost up to US$100,000.

Bluefin tuna are known for their huge size, power and speed. Maximum weights recorded are in excess of 600 kg.

As of June 16, vessels flying the flags of Cyprus, France, Greece, Italy and Malta will be prohibited from fishing for bluefin tuna in either Mediterranean or eastern Atlantic waters. A similar ban goes into force for Spain on June 23. It was not immediately clear if or when Portugal would be subject to a ban.

The bans apply to vessels that use a "purse seine", a type of net that floats the top of a long wall of netting on the surface while its bottom is held weighted under the water.

The European Commission, the EU executive, regulates fishing quotas for member states and also negotiates international fisheries agreements on their behalf.

"The Commission is determined to use all necessary means to prevent a recurrence of the substantial overfishing seen in 2007," it said in a statement.

"Last year, overfishing was largely driven by the industrial purse seine sector of the fleet, which takes more than 70 percent of the total catch."

France's Agriculture Ministry said minister Michel Barnier had expressed his objection to the decision to the EU and called for a meeting of an expert committee to help clarify the use of quotas in the countries concerned.

Environment group WWF was unimpressed with the later date for Spain's ban and said the poor state of stocks should have prevented trawling this year altogether.

"Overfishing and massive illegal catches threaten the survival of bluefin tuna. Fishing should be banned indefinitely at least during June, the key spawning month for Mediterranean bluefin tuna," Aaron McLoughlin, head of WWF's European Marine Programme, said in a statement.

Commission experts say the EU's fishing capacity is so large and bluefin tuna trawling activity so concentrated in June that the EU quota can be exhausted in just two days of fishing. (Additional reporting by Tamora Vidaillet in Paris; Editing by Alison Williams)

.

Is climate change the war to end all wars?

The Guardian's Rosie Boycott gives an impassioned plea on behalf of concerned middle class mothers for action on climate change.

The wording is evocative and takes the moral high ground. In a sense it is politics and by extension economics that is getting in the way.

On the subject of action from the UK government Rosie gets it spot on:

The government still seems to be terrified of motorists, frequent flyers and second home-owners, and is far too timid to take any measures that begin to address the scale of the problem.

Labour are right to be timid. It is tough to blame the government when the vast majority of voters are motorists. Governments are elected to serve the people and the people want cheap petrol. It is a classic tragedy of the commons case.

Here are two of the more passionate paragraphs.

The war to end all wars [Guardian]

How do you define a war? There is the disastrous one that Britain is waging in Iraq, involving tanks and guns and the lives of our young men and women. There is the kind the government claims it is waging variously against poverty, terror, and obesity. But the greatest threat to us all, global warming - a threat far greater than any airborne disease or foreign dictator - has yet to be elevated to war status. Day by day, before our eyes, the planet is deteriorating: ice caps are melting, weather systems shifting, and the poorest are finding themselves facing life-threatening water shortages. Our wildlife is suffering, species are being lost before our children even have a chance to witness them in all their beauty.

../

After the Japanese bombed Pearl Harbour in 1941, the US threw its might behind the war machine, transforming its industries overnight. The bounties of my entire life as a postwar baby have come as a direct result of that giant political will bending towards the common good. Now my daughter's generation demands the same drastic intervention if they are to enjoy the same kind of future.

It can be done and we know the enemy. But where, on our increasingly fragile earth, is the leadership?

Where indeed.

.

Tragedy of the Intergalatic Commons: "In Space no one can hear you scream"

Excellent series of pictures of space junk. A clear tragedy of the commons example.



H/T: 26Econ

For a full set of great pictures see the ESA-ESOC website.

.

Space: the final frontier for the common tragedy

Neat little link between the tragedy of the commons and the shooting down of space hardware from Common Tragedies. The economics is spot on.

Who has the most to lose is the near orbit is made effectively unusable? The US? The Chinese or Russians or sports fans?

Space waste - A tragedy of the cosmic commons [Common tragedies]

Yesterday the Bush administration ordered the military to attempt to shoot down a crippled spy satellite in the next two weeks. While the administration says that it needs to destroy the satellite in order to “prevent any possible contamination from the hazardous rocket fuel on board”, I think it’s clear to all that this is action is a direct response to China’s similar act a year ago. Ignoring all the disingenousness of the justificaton (as if Bush cares about the environment) and the ridiculousness of the missile defense program (Reagan literally dreamed it up after watching Star Wars), there is an interesting economics component to the this story.

Standard procedure for removing unwanted or obsolete satellites from space involves taking them out of orbit and letting them disintegrate in the heat of the atmosphere. This results in essentially no remaining debris. China, for reasons we can only guess at, decided to ignore this protocol when it shot it’s satellite down last January. This resulted in an explosion of debris which is currently racing around the Earth at ten times the speed of a bullet. The effect has been a significant increase in the incidence of debris damage to other satellites. This is interesting because while “space” is conceptually limitless, the section of space optimal for observing and communicating with our planet is becoming increasingly crowded. However, given all of the complexities associated with delimiting and regulating it, this “space” is still essentially a free for all, with actors ignoring externalities and shortsightedly plundering a limited resource. Thus, if we are not careful, space, or at least a section of it, could go the way of Hardin’s commons.

Open-Access Losses and Delay in the Assignment of Property Rights

A new NBER working paper by Gary Libecap examines open-access and the depletion of natural resources. The paper is theoretcal but does include some empirical examples that includes fisheries and non-renewable resources.

Open-Access Losses and Delay in the Assignment of Property Rights

Author

Gary D. Libecap (University of California, Santa Barbara)

Abstract

Even though formal property rights are the theoretical response to open access involving natural and environmental resources, they typically are adopted late after considerable waste has been endured. Instead, the usual response in local, national, and international settings is to rely upon uniform rules and standards as a means of constraining behavior. While providing some relief, these do not close the externality and excessive exploitation along unregulated margins continues. As external costs and resource values rise, there finally is a resort to property rights of some type. Transfers and other concessions to address distributional concerns affect the ability of the rights arrangement to mitigate open-access losses. This paper outlines the reasons why this pattern exists and presents three empirical examples of overfishing, over extraction from oil and gas reservoirs, and excessive air pollution to illustrate the main points.

.

Tragedy of the Commons and Fisheries: An empirical study

Although it is too late for my 211 students and their assessed work, I have just come across an excellent working paper by Stephanie McWhinnie.

The title of the paper is:

The Tragedy of the Commons in International Fisheries: An Empirical Examination[PDF]

Historically, all capture fisheries have proven hard to manage; internationally shared stocks face an additional impediment to effective management. Previous fisheries studies estimate gains from cooperation for particular species or locations, but evidence is lacking on the wider effect that international sharing has in relation to other variables that affect stock status. This paper is an attempt to shed a broader light on the effect of sharing by identifying whether shared fish stocks are systematically more exploited. I compile exploitation status, biological and economic data into a unique two-period panel of more than two-hundred fish stocks from around the globe with which I test the theoretical implications of sharing. The empirical results from ordered category estimation suggest that shared stocks are indeed more prone to overexploitation.

.

Economics of Extinction, Chinese medicine and Tibetan caterpillars

The FT weekend magazine has an excellent article about a Caterpillar that turns into a fungus and is worth £19,000 a kilo. Why? Because it is highly valued in the booming Chinese medicine market.

Result - our old friend "tragedy of the commons" rears its ugly head and is driving the caterpillar to extinction taking with it the livelihoods of many locals from the Tibetan plateau.

Any article that has the term "sprouting through its forehead" in the first few paragraphs has to be worth reading. As this fungus cures all ills, including erectile dysfunction, there is likely to be a growing market with demand rising considerably.

The revelation that this fungus is also used to bribe officials may say something about the health of the said officials.

An interesting read. Some quotes are provided below:

Rich pickings [FT]

../

The fungus "Yartsa gunbu," or "Cordyceps" is a medicinal mushroom that grows parasitically on a moth caterpillar native to the Himalayas and Tibetan plateau, Cordyceps sinensis is a rare and expensive Chinese medicine.

../

Last winter, fungus spores landed on a caterpillar and began to consume its body, slowly killing it. As it died, the caterpillar burrowed underground. Eventually the fungus overtook the body, sprouting through its forehead and out of the ground – producing the growth Wang-yag spotted. The lifecycle is contained in the Tibetan name: yartsa gunbu means “summer grass winter worm”.

../

In Chinese medicine, caterpillar fungus is known as something of a wonder-drug. Boiled in soup or eaten whole, it is said to aid every ailment from immune deficiencies to erectile dysfunction.

../

Cordyceps is incorporated into several western products, such as Origins’ Mega-Mushroom skin creams and Steven Seagal’s Lightning Bolt energy drink. Demand is also rising in China, where chongcao, or “worm-grass”, is rolled into cigarettes, turned into elaborate dishes at special caterpillar fungus restaurants, and used to bribe officials. Prices, in turn, are skyrocketing. One kilo of prime Cordyceps now draws Rmb300,000 – more than £19,000.

It is clear that harvesting is a slow process. This may not give a good impression of the household work allocation in Tibet.

When Wang-yag returns to her tent after a day of picking, her husband, Sonam Rrichen, is there waiting. A loud man with darting eyes, he spends most of his free time polishing his motorcycle, which he bought this spring with Cordyceps money. Wang-yag hands him her bu, and he combines it with his own, collected in the hills surrounding a relative’s tent. He counts: 20 caterpillars in two days.

The collection of this fungus is also somewhat frowned upon:

Although Cordyceps was harvested in past centuries, Buddhism held that it disturbed earth spirits and its collection was taboo. Sonam Rrichen recalls an old saying: “Picking one bu is like killing 18 men.” Today, only monks and nuns abstain. In parts of the plateau where the harvest is less regulated, some people begin picking in early May, before the fungus is mature. Others don’t replace the soil they dislodge, exacerbating erosion, already a serious problem.

As with any valuable resource regulation and conflict go hand in hand. As the fungus becomes rarer the protection of "property rights" gets more intense.

Increasingly, the harvest also leads to conflict. In Sichuan, Tibetans clashed over picking rights in July, brandishing semi-automatic rifles and grenades in a conflict that killed six and left 100 wounded. Earlier in the season, in Nepal, 16 people died while trying to pick during a blizzard. And in 2005, when nomads from neighbouring Nangchen ventured on to Dzato land to search for the fungus, the government reacted by taxing the outsiders while the locals blockaded the county’s main road. Nangchen pickers broke through the barriers, prompting a two-week clash in which houses were razed, stores looted and at least one man died.

Whenever there are weak property rights there will be problems. The caterpillar it seems is disappering fast.

Caterpillar fungus, it seems, is disappearing. When Wang-yag started picking 24 years ago, she found 200 to 300 fungi a day (older relatives remember picking 1,000). Now she finds 10 on a good day. Last year, Indian zoologists documented a 30-50 per cent decline of the fungus over a two-year period in villages in the Indian Himalayas. This year, Chinese ecologist Yang Darong found that Cordyceps numbers in western China have fallen to between 3.5 and 10 per cent of their totals from 25 years ago.

Ah, the beauty of economics:

Tibetan pickers, meanwhile, are caught in a vicious cycle: as prices increase, collection becomes all the more irresistible.

Until they are all gone of course - boom and bust.

As with non-renewable resources, perhaps technology can save the day:

As worries about the sustainability of Cordyceps increase, finding a substitute has become a priority in China and abroad. Researchers have isolated polysaccharides that they believe are the active ingredients. Several companies have reproduced these by culturing the fungus in liquid or on grains of rice, wheat or barely, creating a caterpillar-free “cultivated” Cordyceps.

Rhinos, antelopes and externalities

A good example of unintended consequences hinged with some tragedy of the commons. Given we covered the economics of extinction in today's "Environmental economics" lecture the timing of this news article is propitious.

There is something depressingly inevitable about the Rhino protection plan from the very start. Where were the economists?

A decade ago, the saiga antelope seemed so secure that conservationists fighting to save the rhino from poaching suggested using saiga horn in traditional Chinese medicines as a substitute for rhino horn.

Maybe I will take down the WWF advert in the sidebar in protest - "Adopt an animal as a wonderful christmas present for someone that will make a difference" :-)

Rhino rescue plan decimates Asian antelopes [New Scientist]

An antelope that just a decade ago crammed the steppes of central Asia is this spring on the verge of extinction, victim of an epidemic of poaching. Biologists say it is the most sudden and dramatic population crash of a large mammal ever seen.

In 1993, over a million saiga antelopes roamed the steppes of Russia and Kazakhstan. Today, fewer than 30,000 remain, most of them females. So many males have been shot for their horns, which are exported to China to be used in traditional fever cures, that the antelope may not be able to recover unaided.

The slaughter is embarrassing for conservationists. In the early 1990s, groups such as WWF actively encouraged the saiga hunt, promoting its horn as an alternative to the horn of the endangered rhino.

Saiga (Saiga tatarica) once dominated the open steppes from Ukraine to Mongolia. They have always been hunted for meat, horns and skins. However, even in Soviet times, hunters killed tens of thousands each year, without dramatically lowering the population.

But since the collapse of the Soviet Union, a lucrative market in the horns has opened up, with hunters using motorcycles and high-powered weapons to chase and kill their quarry. In China, saiga horns fetch around $100 a kilogram. Organised gangs illegally export the horn by train from Moscow to Beijing, or across the border from Kazakhstan.

Black with antelopes

"The plains used to be black with these antelopes, but now you can go out there and not see any at all," says Abigail Entwistle, a zoologist from Fauna and Flora International, a British-based charity. "This is the most sudden change in fortune for a large mammal species recorded in recent times."

The closest comparison may be with the African elephant, which faced a similar poaching frenzy in the 1980s, causing its numbers to fall from a million to half a million in a decade. But the saiga's numbers, which started at a similar level, have fallen by 97 per cent.

The scale of the slaughter, and its almost total destruction of the male saiga, has overwhelmed the animals' famed fecundity. "We don't know of any case in biology where the sex ratio has gone so wrong that fecundity has crashed in this way," says Eleanor Milner-Gulland of Imperial College, London, the leading expert in the West on the species.

Between 1993 and 1998, saiga numbers across central Asia almost halved, to around 600,000. Then, with most of the males gone, the population crash began in earnest, says Milner-Gulland. Numbers have halved each year since, until 2001's census recorded just 30,000 individuals. There is, she says, no sign that the crash is due to disease or unusual weather.

No return

One of the most critically endangered herds is in the huge Betpak-Dala region in central Kazakhstan, where in 1993 more than half a million saiga lived. By 2001 their numbers had crashed to just 4000 - a 99 per cent drop from which there may be no return.

Aerial surveys in 2001 by the Institute of Zoology in Kazakhstan revealed no adult or juvenile males, only females, says Milner-Gulland. And time is running out to bring extra males in, as saiga antelopes normally only live for three to four years.

Conservationists have struggled to keep up with the scale of the disaster, and did not put the saiga on the Red List of critically endangered species until October 2002. In the coming months they will launch an emergency appeal to rescue wild herds.

"We think we have probably got just two years to save the species," says Entwistle. "The trouble is, most people have never heard of the animal, so it is hard to raise funds."

Confined to zoos

It is unlikely that hunters will drive the saiga to total extinction, as they did the dodo, quagga and passenger pigeon. But without a dramatic reversal of its fortunes, it will soon be confined to zoos and a few small reserves.

A decade ago, the saiga antelope seemed so secure that conservationists fighting to save the rhino from poaching suggested using saiga horn in traditional Chinese medicines as a substitute for rhino horn.

Research commissioned by WWF at the Chinese University of Hong Kong in the late 1980s found it to be as effective as rhino horn in fighting fevers, and in 1991 WWF began a campaign in Hong Kong to publicise it as an alternative. The following year, the UN Environment Programme appointed WWF ecologist Esmond Bradley Martin as its "special envoy" to persuade pharmacists across Asia to adopt saiga horn (New Scientist print edition, 9 March 1991 and 3 October 1992).

But the saiga had died out in China in the 1960s, and the resulting upsurge in demand opened the floodgates to unregulated imports. By 1993, says Milner-Gulland, "Hong Kong markets were piled high with saiga horn" from Kazakhstan and Russia. The slaughter had begun.

Bradley Martin is unapologetic. He told New Scientist: "I supported the use of saiga antelope horn as a substitute for rhino horn from the early 1980s. In my opinion it was the correct policy at the time. But I stopped around 1995, when I read about the start of the sharp decline in saiga populations."

H/T: marginal revolution

"Encroaching Desert, Hidden Water"

Headline of the week award goes to the Independent for this desertification article (even if I changed "missing" to "hidden" in my title).

This is a good article and is littered with examples of X watched as his farm disappeared and Y looked on as the lake dried up. All well and good and makes for a compelling read but there is a lack of substance.

For example,

"The water is less and less every year, and without water we can't grow the crops," said Jiang, who wears a baseball cap at a jaunty angle and smokes copious cigarettes as he sits on a stool surrounded by drying cotton.

What is the jaunty angled baseball cap telling us exactly?

The gathering sandstorm: Encroaching desert, missing water [Independent]

China is losing a million acres a year to desertification. In Dunhuang, a former Silk Road oasis in the Gobi, the resulting water shortage has become critical.

This statistic is more worrying. We all know that China is large and that it has a huge population but did we know that 1/5th of China is desert?

The government in Beijing acknowledges desertification as the biggest environmental challenge holding back sustainable development, and has pledged to control the country's spreading deserts, which already cover a fifth of its land.

So what can be done? The following quote does suggest that all will not continue to be rosy in China and a whiff of social unrest is in the air. If we thought a 1/5th was a lot SPEA are suggesting 40% "soon" although no indication is given to "how soon is now?"

China's environmental watchdog, Sepa, says the desert's march is claiming a million acres of land every year, and soon 40 per cent of China could be lost to the creeping sands brought in by worsening sandstorms. Millions of tons of sand from the Gobi desert are dumped on Beijing by sandstorms every spring, and Chinese dust makes its way into the skies above cities as far away as Los Angeles. China suffers from a shortage of 30 billion cubic metres of water for irrigation every year. And while China has more than 20 per cent of the world's population, it has only 7 per cent of its arable land, precious farmland that the desert is slowly but surely eating its way into. This could result in higher food prices throughout China, a potential disaster given 750 million people live on less than £1 a day and can ill afford more expensive rice and other staples.

Finally, to emphasise the economics lurking behind this story one only needs to look for the "tragedy of the commons" quotes that the locals inadvertently speak of:

In a neighbouring field, He Zicheng, 50, is clearing a field with his son Wei, loading the brush from the cotton fields on to a cart. His nine sheep nose around, seeking mouthfuls to nibble on. Slim pickings. "Without water the cotton doesn't grow well. Ten years ago we had more water, but there were too many wells and now we have this," he said.

Or what about this one:

Song points to a mark where the water level used to reach. "The biggest shortage we have at Dunhuang is water. It's disappearing because the water table is falling and the spring is not producing as much as before. The trees won't grow, because there is not enough water. It was used up by farmers when irrigation started in the 1970s and the underground water started to diminish," said Song.

Unless government policy includes issues related to "property rights" things are unlikely to improve.

.

Ecuador, non-renewables and Coase

In a post that covers pretty much the entire environmental economics course in one way or other, Ecuador has suggested that the developed world pay it $350 million a year not to pump any more crude oil, thereby avoiding further pollution of its eastern rainforest.

Is this a Coasian bargaining problem? Who are the suffers and who are the polluters?

It is difficult not to be sceptical - will the West actually pay up? Can the Ecuadorian government be trusted? Will it not take the money now but find the bounty beneath the ground to tempting to pump out later? Will the individuals in Ecuador that have experienced the largest suffering actually see any of the $350,000,000?

Ecuador’s startling oil proposal [Chinadialogue]

Oil has been pumped from here for almost four decades and the result, say environmentalists, is 1,700 square miles (4,400 square kilometers) of industrial contamination, with rivers poisoned, wildlife wiped out and humans falling sick.

But now, mindful of the environmental and political cost, the state has made a startling proposal: if wealthy nations pay Ecuador $350 million a year -- half of the estimated revenue from extraction -- it will leave the oil in the ground.

Supporters say it is an idea whose time has come, a logical step forward from carbon offsetting, in which rich polluters in developed countries compensate for environmental damage caused by their consumer habits.

Since the proposal was first floated in June, there have been promising signals, said Alberto Acosta, a former mining minister and close ally of president Rafael Correa. The German and Norwegian governments have expressed interest, as have parliamentarians from Italy, Spain and the European Union. “This could be a historic accommodation,” he said. Donors could pay in cash, debt relief or other indirect ways.

Some greens champion the proposal as a way to protect biodiversity and combat global warming while allowing a poor country to develop. “It’s not utopian, it’s realistic,” said Esperanza Martínez, of the Quito-based organisation Acción Ecológica (Ecological Action).

But others are sceptical. They predict that rich countries will not stump up the money and that Ecuador’s government will ultimately find its oil bounty too tempting to pass up. The government and oil companies already are eyeing another chunk of Amazonian rainforest, the Yasuní national park, a UNESCO-designated biosphere reserve. Beneath part of the 982,000-hectare park lie the Ishpingo-Tambococha-Tiputini (ITT) oilfields, with an estimated one billion barrels of heavy crude. For the cash-strapped government, this is a tempting bounty potentially worth up to $700 million a year.

“It's a ploy; we don’t trust the government on this,” said Anita Rivas, the mayor of Coca, a town on the edge of the park. Like many in the Amazon, she scorned the notion that oil revenues would ease poverty, a mantra of successive governments worn thin by decades of stolen or wasted revenues. “Where are the benefits?” said Ms Rivas.

Even Acosta said: “We don't want to develop it because we know there will be damage. But if we have no other choice then, lamentably, we will do it.”

The costs of Ecuador’s oil industry are all too visible in those parts of the jungle where crude has been drilled, spilled, pumped and dumped -- a vision of what might be in store for Yasuní park.

Between Coca and Lago Agrio, bleak oil-rush settlements carved out of the bush, oil is never far away. It is in the 300-mile (480-kilometre) pipeline stretching through valleys and mountains. It is in the air in the form of rain and waste gas burnt by flares. It is in 1,000 or so waste pits of black sludge that leak into the water supply. It is in the soil in the form of congealed tar that stunts trees.

It is in the bodies of residents, according to several scientific studies, in the form of tuberculosis and other diseases that make hamlets such as San Carlos, adjacent to a refining plant, zoom off the medical charts. “Two-thirds of my patients have contamination-related illnesses,” said Rosa Moreno, a nurse at a small clinic.

Oil is even in the name Lago Agrio. It means Sour Lake and is taken from the Texas hometown of Texaco, the United States oil giant that drilled in the region from 1972 to 1992 and operated as a mini-state.

Chevron, the even-bigger giant that subsequently bought Texaco, is now embroiled in a $6 billion class-action lawsuit brought by 30,000 indigenous people and settlers. They claim that Texaco poisoned the region by dumping billions of gallons of toxic waste-water and want the company to clean it up. It is one of the world’s biggest environmental cases and has been dragging on for 14 years. “What happened here, we can’t let happen anywhere else, least of all Yasuní,” said the plaintiffs’ lawyer, Pablo Fajardo.

Chevron says Texaco broke no law, performed a $40 million clean-up in 1995 and that any contamination must be the fault of other companies that have operated there since then. “Ours was a beautiful operation, very clean. This lawsuit is a farce,” said Rodrigo Perez, a company lawyer.

Regardless of blame, there is no doubt that oil has devastated much of Ecuador’s forests. The question is whether Yasuní -- which is said to have more tree species in an average hectare than there are the US and Canada combined -- will be next.

For the indigenous tribes who call the region home, the untapped wealth far beneath the jungle floor is a threat.

“We wish it weren’t here,” said Wiyame Irumenga, an indigenous leader and forest ranger, tapping a bare foot against the earth. “We wish people would just forget about it.”

.

Bubbles in Prices of Exhaustible Resources

In Econ211 Environmental Economics we will soon be covering the Hotelling (1931) Rule.

This paper takes it on to look at bubble equilibria. With many non-renewable resource prices at record highs this is a timely paper.

-------------------------------------------------

Bubbles in Prices of Exhaustible Resources

BOYAN JOVANOVIC
New York University - Department of Economics; National Bureau of Economic Research (NBER) August 2007

NBER Working Paper No. W13320


Abstract:
Aside from the equilibrium that Hotelling (1931) displayed, his model of non-renewable resources also contains a continuum of bubble equilibria. In all the equilibria the price of the resource rises at the rate of interest. In a bubble equilibrium, however, the consumption of the resource peters out, and a positive fraction of the original stock continues to trade forever. And that may well be happening in the market for high-end Bordeaux wines.


JEL Classifications: E44, G12

Becker-Posner debate Chinese Pollution

It is encouraging to see that two of the heavy weights of Economics blogging have deemed it interesting enough to post on Chinese pollution levels. They touch on an issue we have been highlighting on this blog since its inception.

China is in many respects the front line issue of environmental economics in my opinion.

The Posner-Becker article covers the basic environmental economics of the topic touching on Coase and Kuznets curves. Posts on these topics can be found under the "Environmental Economics" label in the sidebar or by simply searching this blog from the search bar at the top of the blog. It is a good refresher and some excellent comments have been added.

What spurred their interest was the New York Times article we discussed below.

Growth and the Environment

In an article by E.C. Economy she really goes to town with a good 7 page article on the topic (highlights in this post).

Elizabeth C. Economy on "The great leap backward?"

Other posts from the last month alone that may be of interest include:

Environmental Cheap Talk in China

The Toothless Dragon: New Chinese Environmental Regulations

Japan blames China for increased pollution: Transboundary effects


It will not be long until my Econ211 students have to get their teeth into this stuff.

Elizabeth C. Economy on "The great leap backward?"

We have talked at length in this blog about the environmental impact of China both within China and globally and specially the impact of environmental degradation on future growth and political stability. This long post covers this ground and more.

It is interesting to quote from China Briefing who write:

As Pan Yue, the vice minister for China’s State Environmental Protection Agency (SEPA) warned in 2005 when talking about China’s booming growth, “The miracle will end soon because the environment cannot keep pace."

They go on to highlight the following article in Foreign Affairs by E. Economy. We have posted on some of her work previously. This is a long article that basically goes over ground that will be familiar to readers of this blog but this is at least a little more academic that the TIME article from last week.

This is an excellent and accessible article. The information contained within this one article could supply another 20 blog posts (and may well do so).

The Great Leap Backward?

Summary: China's environmental woes are mounting, and the country is fast becoming one of the leading polluters in the world. The situation continues to deteriorate because even when Beijing sets ambitious targets to protect the environment, local officials generally ignore them, preferring to concentrate on further advancing economic growth. Really improving the environment in China will require revolutionary bottom-up political and economic reforms.

Elizabeth C. Economy is C. V. Starr Senior Fellow and Director for Asia Studies at the Council on Foreign Relations and the author of The River Runs Black: The Environmental Challenges to China's Future.

There are a few choice quotes/statistics that are worth pulling out.

The coal that has powered China's economic growth, for example, is also choking its people. Coal provides about 70 percent of China's energy needs: the country consumed some 2.4 billion tons in 2006 -- more than the United States, Japan, and the United Kingdom combined.

This is a quite remarkable statistic but does show how much room there is for improvement. To think of Chinese industry becoming more efficient with a similar wage level shows that competition from China can only intensify.

Consumption in China is huge partly because it is inefficient: as one Chinese official told Der Spiegel in early 2006, "To produce goods worth $10,000 we need seven times the resources used by Japan, almost six times the resources used by the U.S. and -- a particular source of embarrassment -- almost three times the resources used by India."

So where are the limits to growth?

As much as 90 percent of China's sulfur dioxide emissions and 50 percent of its particulate emissions are the result of coal use. Particulates are responsible for respiratory problems among the population, and acid rain, which is caused by sulfur dioxide emissions, falls on one-quarter of China's territory and on one-third of its agricultural land, diminishing agricultural output and eroding buildings.

But solving one problem does not help with the thirst for transport:
Chinese developers are laying more than 52,700 miles of new highways throughout the country. Some 14,000 new cars hit China's roads each day. By 2020, China is expected to have 130 million cars

For those who do not live in China it is hard to really gauge how bad the pollution really is. Many of us have been to New York however:

Levels of airborne particulates are now six times higher in Beijing than in New York City.

What about the efficiency of agriculture? There are problems ahead.

The Gobi Desert, which now engulfs much of western and northern China, is spreading by about 1,900 square miles annually; some reports say that despite Beijing's aggressive reforestation efforts, one-quarter of the entire country is now desert. China's State Forestry Administration estimates that desertification has hurt some 400 million Chinese, turning tens of millions of them into environmental refugees, in search of new homes and jobs.

China's agricultural sector is also inefficient:

The agricultural sector lays claim to 66 percent of the water China consumes, mostly for irrigation, and manages to waste more than half of that

Water in general is a growing problem that we have previously highlighted in this blog:

Pollution is also endangering China's water supplies. China's ground water, which provides 70 percent of the country's total drinking water, is under threat from a variety of sources, such as polluted surface water, hazardous waste sites, and pesticides and fertilizers. According to one report by the government-run Xinhua News Agency, the aquifers in 90 percent of Chinese cities are polluted. More than 75 percent of the river water flowing through China's urban areas is considered unsuitable for drinking or fishing, and the Chinese government deems about 30 percent of the river water throughout the country to be unfit for use in agriculture or industry. As a result, nearly 700 million people drink water contaminated with animal and human waste.

So can the rest of the world afford to sit and watch as China destroys itself? Not with the forces of globalisation at work:

Japan and South Korea have long suffered from the acid rain produced by China's coal-fired power plants and from the eastbound dust storms that sweep across the Gobi Desert in the spring and dump toxic yellow dust on their land. Researchers in the United States are tracking dust, sulfur, soot, and trace metals as these travel across the Pacific from China. The U.S. Environmental Protection Agency estimates that on some days, 25 percent of the particulates in the atmosphere in Los Angeles originated in China.

So what about international trade? China is contributing to environmental problems elsewhere by its insatiable demand for raw materials.

China is already the largest importer of illegally logged timber in the world: an estimated 50 percent of its timber imports are reportedly illegal.

This article covers it all - here is Economy on the political ramifications.

In the view of China's leaders, however, damage to the environment itself is a secondary problem. Of greater concern to them are its indirect effects: the threat it poses to the continuation of the Chinese economic miracle and to public health, social stability, and the country's international reputation. Taken together, these challenges could undermine the authority of the Communist Party.

Here are some statistics on the costs of environmental destruction:

The Chinese media frequently publish the results of studies on the impact of pollution on agriculture, industrial output, or public health: water pollution costs of $35.8 billion one year, air pollution costs of $27.5 billion another, and on and on with weather disasters ($26.5 billion), acid rain ($13.3 billion), desertification ($6 billion), or crop damage from soil pollution ($2.5 billion).

Also, with the effect of pollution on health it will be not be long before the protests become more vociferous.

Today, fully 190 million Chinese are sick from drinking contaminated water. All along China's major rivers, villages report skyrocketing rates of diarrheal diseases, cancer, tumors, leukemia, and stunted growth.

Social unrest over these issues is rising. In the spring of 2006, China's top environmental official, Zhou Shengxian, announced that there had been 51,000 pollution-related protests in 2005, which amounts to almost 1,000 protests each week.

For all the talk of direct action in the West it is apparent that the Chinese are already being forced to take action into their own hands:

After trying for two years to get redress by petitioning local, provincial, and even central government officials for spoiled crops and poisoned air, in the spring of 2005, 30,000-40,000 villagers from Zhejiang Province swarmed 13 chemical plants, broke windows and overturned buses, attacked government officials, and torched police cars.

Given these issues you would expect the Chinese environmental agency to be all hands to the pump. Not exactly. SEPA is China's premier environmental agency.

But SEPA operates with barely 300 full-time professional staff in the capital and only a few hundred employees spread throughout the country. (The U.S. Environmental Protection Agency has a staff of almost 9,000 in Washington, D.C., alone.)

After discussing the local official corruption problem Economy concludes by saying:

China's leaders have shown themselves capable of bold reform in the past. Two and half decades ago, Deng Xiaoping and his supporters launched a set of ambitious reforms despite stiff political resistance and set the current economic miracle in motion. In order to continue on its extraordinary trajectory, China needs leaders with the vision to introduce a new set of economic and political initiatives that will transform the way the country does business. Without such measures, China will not return to global preeminence in the twenty-first century. Instead, it will suffer stagnation or regression -- and all because leaders who recognized the challenge before them were unwilling to do what was necessary to surmount it.

This excellent article should be read at length to fully appreciate the picture that I have only tried to shed a little light on in this post.

.

Water Wars in East Asia

There is a certain inevitability about water (specifically the scarcity of water) being the cause of military conflict in the future.

As economists, the "economics of dams" is something we are currently looking at. My bold.

With quotes like these it is not hard to see that these will be trouble ahead. The problem is, China is a not someone you want to pick a fight with in a hurry.

"Yet many Chinese can't quite fathom the Mekong's importance to other countries. "This is our part of the river, so we should be able to do what we want with it," says Hu Tao, a geological engineer who has worked at Xiaowan for two years."

For an economist THIS is the question:

"These dams may boost economic growth in developing countries facing severe energy crunches."

With an environmental economics hat on the issue is this:

"But dams also have severe, long-term environmental consequences."

One has a feeling that environmentalists are going to have to shout loud and long to be heard.

This TIME article is therefore timely. H/T: IPE Zone.

Charting the Mekong's Changes

As the biggest of the eight dams China plans for its portion of the Mekong, Xiaowan will dwarf the two hydropower projects that have already been built in Yunnan. Given that half the Mekong basin's water comes directly from China during the dry season, scientists worry that Xiaowan will act as a spigot that controls the destiny of millions of people in five countries. Environmental groups estimate that 35% of the silt that's needed to fertilize floodplains down south may be obstructed by the dam — distressing news for a region that depends on the Mekong for 80% of its protein needs and, in the lower river basin, rice production.

Yet many Chinese can't quite fathom the Mekong's importance to other countries. "This is our part of the river, so we should be able to do what we want with it," says Hu Tao, a geological engineer who has worked at Xiaowan for two years. "The other countries can do what they want with their sections of the river." In some ways, Hu's indifference is understandable. Roughly half the Mekong lies in China, but for most of that length its waters are too swift to support barge traffic or wide-scale fishing. (The Chinese name for the river, Lancang, means "turbulent.") The only real benefit humans can coax out of this stretch of water is hydroelectric power — and until recently the river's remoteness discouraged even that. "In China, the Mekong is not the same river as it is down in the basin," notes Eric Baran, a research scientist based in Phnom Penh for the nonprofit World Fish Center. "Here in Cambodia, it is a matter of life and death. In China, it is just another river — and not even a very major one."

But with China's energy needs soaring even in underdeveloped provinces like Yunnan, the Mekong is potent enough to be exploited for electricity. Some of that power, ironically, will be exported to countries like Thailand, where hydroelectric projects are controversial and have been blocked by ecologically minded citizens. Huaneng doesn't have to worry about public interference. The state-owned company is run by the well-connected son of China's former Premier, Li Peng. And with no shareholders calling for environmental-impact surveys or feasibility studies, Huaneng rarely makes public details of its plans until just months before it breaks ground. (The company declined requests for an interview.)

Nor does the Chinese government feel the need to consult its southern neighbors. Beijing has refused to join the Mekong River Commission, which was formed 12 years ago by four other riparian nations. (Burma is also not a member.) "I think China doesn't want to join the commission because then there will be environmental expectations," says the International River Network's Middleton. "But when the biggest country at the source of the river isn't part of the commission, it makes the group basically toothless."

That sense of helplessness extends to many in Yunnan as well. The Xiaowan project has forced 35,000 people from their homes, often with minimal compensation. Wang Zhengjun was uprooted in 2004 from his farmland on the banks of the Mekong with only six months' notice. Although he was provided a new house by Huaneng, the 42-year-old says it's much smaller than his old one — and it doesn't come with the fertile soil that supported his family for generations. Villagers were told the dam would be a financial boon to local residents. But Wang and others contend that the best jobs have gone to migrant laborers. Locals, many of whom are members of China's disenfranchised ethnic minorities, tend to earn less than half of what even the lowest paid outside workers get. "They promised us jobs, money, everything," says Wang, sitting in the ramshackle village overlooking the dam-construction site that is now his home. "But they have delivered us nothing."

China's dam building isn't limited to its sovereign stretch of the river. In June, the Laotian government gave initial approval for a $1.7 billion dam on the Mekong that will be built by two Chinese power companies. Another Chinese firm is conducting a feasibility study for a Mekong power project in Cambodia, in an area where other foreign companies have been reluctant to invest because of the adverse ecological impact. Several other Mekong tributary dams in Southeast Asia will be financed by China Exim Bank, the nation's largest credit agency, which has invested in power projects with the enthusiasm of the Great Depression-era U.S. government.

These dams may boost economic growth in developing countries facing severe energy crunches. Vietnam, for example, suffers from chronic electricity shortages, and compared with coal-fired and oil-burning plants, hydropower is a relatively clean and inexpensive solution. But dams also have severe, long-term environmental consequences. Vietnam's Mekong Delta, where the river finally meets the sea, is a vast web of waterways that serves as a giant rice bowl, providing the nation with half of its total agricultural output. Yet in part because of the increasing number of dams reducing the flow of the river, salt water from the South China Sea has begun traveling up the Mekong. The influx of brackish water over the past few years has ravaged farms and fisheries. This spring in the delta's Mo Cay district, Nguyen Thi Hong and her husband watched helplessly as salt water infiltrated their fish farms and fields. During the worst 10-day stretch, 100 catfish died a day, while their entire aquatic-vegetable crop withered. "Our pigs and cows are still sick from drinking the salty water," says Hong, who lives about 30 miles (50 km) inland. "Nothing was spared."

Even as one way of life begins to fade, another springs into existence. For so long, the Mekong Delta, despite its riverine abundance, has been scarred by a grueling cycle of war and poverty. Today, the area is welcoming Chinese investors, who have flocked to newly constructed industrial zones where Vietnamese factory workers churn out motorcycles, shoes and televisions. This year, a $1 billion industrial park funded by some 40 Chinese businesses is set to open near the South China Sea, providing jobs for tens of thousands of Vietnamese. Like the rest of the country, the delta has a booming young population that is profiting from Vietnam's economic reforms. For this striving generation, their homeland's historic enmity with China is all ancient stuff. Do Quang Tranh speaks of how magnificent imported Chinese products are, describing in wonderment the "beauty of Chinese-made bricks." If he had his wish, this farmer would trade his fields for a job in a Chinese-invested factory — even though his village's elderly commune chief warns against "that frightening country up north." The ebb and flow of the Mekong has both blessed and cursed the people of the Delta. For Tranh and other Vietnamese, they can only hope to profit from what the river now brings to Vietnam's shores: the energy of China's economic expansion, and the lure of a better life.

Salmon and Flamingos

After the creation of the "Wildlife" tag for the Bear story below two other stories have come to light. At the heart of "environmental meltdown" is economics of course. The second article is a classic "tragedy of the commons" story.

Factory may destroy natural wonder

One of nature's most spectacular sights - millions of pink flamingos migrating between the Rift Valley's alkaline lakes - is in danger of disappearing forever, according to conservationists.

Tata Chemicals, part of the giant Tata industrial group in India, plans to construct a soda-ash plant on Lake Natron in northern Tanzania, the most important breeding spot for the endangered lesser flamingo. Each summer 500,000 of the birds, three-quarters of the world's breeding population, fly to the lake to nest.

and in Russia: (h/t. Chinadialogue).

The end of the wilderness

Sitting in his snug log cabin next to the swirling Bystraya river, Alexander explained when he went fishing.

"Sometimes we do in the day. Sometimes we do it at night. There's no set time," he admitted, passing round a tub of mouth-wateringly delicious wild salmon and a chunk of brown bread.

"In the winter we dig holes in the ice and fish. We also shoot geese," he said, showing photos of himself cradling his rifle in a large snow hole, next to his floppy-eared retriever Bzhik.

Alexander is a poacher. Not a solitary amateur, but part of a professional gang, equipped with boats and a four-wheel-drive jeep. In an outbuilding, poachers in green fatigues were carefully repairing their nets. His workplace is Kamchatka, a remote volcanic peninsula on Russia’s Pacific coast, 7,500 miles (12,000 kilometres) and nine time zones east of Moscow.

Kamchatka is home to a quarter of the world's salmon. Every July and August, millions of the fish struggle up its rivers and lakes to spawn. But, increasingly, most of them don't make it.

"We catch so many fish that the different salmon species no longer return. Once we've exhausted one species we move on to the next," Alexander said, offering me a spoonful of orange salmon caviar and a cup of tea.

Poaching in Kamchatka is on such a large scale that, like the sturgeon, the Pacific salmon is at risk of disappearing altogether. The 750-mile (1,200-kilometre) peninsula is one of the world's last truly great wildernesses, home to the rare Steller’s sea eagle, puffins and brown bears, who roam around its geysers and snow-covered calderas, or collapsed volcanoes. Kamchatka has more than 300 volcanoes, 29 still smoulderingly active.

As the main food source rapidly disappears, however, conservationists fear that Kamchatka is on the brink of ecological meltdown. Laura Williams, director of WWF's Kamchatka office, said: "When you fly over Kamchatka, you are in awe of the wilderness below you. There are no roads and no settlements. I think right now the threats are relatively localised -- with the exception of salmon, which is very widely over-fished."

In Soviet times, the Kamchatka peninsula was a strategic military base, off-limits to foreigners. Poaching was severely punished. But with the collapse of communism, and Russia's transition to a market economy, the law has ceased to exist. Instead, poachers pay off the officials tasked with protecting the fish. Asked whether politicians, the police or ordinary Russians were involved in this trade, Valery Vorobyev, the director of one of Kamchatka's largest fishing firms, Akros, said: "Everybody."

The result of this ubiquitous criminal enterprise, according to Mr Vorobyev, is that the region's once-abundant marine life is vanishing. Out in the Sea of Okhotsk, a slate-grey expanse of frozen water that stretches from Kamchatka's western coast to the gulag town of Magadan, the crabs have all but gone.

"In 1992 we caught 35,000 tonnes of king crab. Last year it was 3,400 tonnes. We need to stop fishing crab now if the species is to survive," Mr Vorobyev said. A further threat to the salmon came from the recent discovery of oil on the peninsula's western shelf.

In the Bering Sea, on the east coast near the foggy town of Petropavlovsk-Kamchatsky, illegal Japanese trawlers have cleaned out the pollack.

Kamchatka has about 12,000 salmon-eating bears -- the largest population in Eurasia. But they, too, are in trouble. In April and May, American hunters using helicopters and snowmobiles shot 300 bears -- a perfectly legal pursuit costing $10,000 (£5,000) per dead bear. Illegal hunting accounted for another 600.

../

Observers believe more than 100,000 tonnes of salmon a year are illegally fished. They are mostly taken for their caviar, which sells for 1,000 roubles (£20, or $40) a kilo (2.2 pounds). The fish are thrown away. The problem is made worse by the region's stunning remoteness -- a nine-hour plane journey from Moscow, the world's longest domestic flight.

Cross-boundary pollution: China's sand (and toxic dust) on the move

Hot on the heels of a post on the impact that Chinese rubbish is having on neighbouring countries comes news that Chinese sand is causing even greater cross-boundary pollution problems. Whilst sand causes problems enough, when it is mixed with toxic dust it makes for a damaging cocktail.

Such sandstorms are blamed for "scores of deaths and billions of dollars worth of damage". There is no doubting the economic impact of the problem.

Choking Sand Storms Head for South Korea

SEOUL - South Korea said a pall of sand mixed with toxic dust from China could make its way to the Korean peninsula late on Thursday, starting a seasonal event blamed for scores of deaths and billions of dollars in damages.

The sand storms have been growing in frequency and toxicity over the years because of China's rapid economic growth and have led to increased tension with neighbours South Korea and Japan.

../

The dust, which originates in the Gobi Desert in China, picks up heavy metals and carcinogens such as dioxin as it passes over Chinese industrial regions, before hitting North and South Korea and Japan, meteorologists say.

Dry weather and seasonal winds in China hurl millions of tonnes of sand at the Korean peninsula and Japan each spring.

South Korea used to have yellow dust storms about four days a year in the 1980s, nearly eight days a year in the 1990s and over 12 days a year since 2000, the Environment Ministry said.

The state-sponsored Korea Environment Institute said the dust kills up to 165 South Koreans a year, mostly the elderly or those with respiratory ailments, and make as many as 1.8 million ill.

Annual economic damage to South Korea from the storms is estimated at between 4.2 trillion won to 5.5 trillion won ($4.47 billion to $5.86 billion), according to the institute.

When a storm hits, skies turn a jaundiced hue. Schools shut down and warnings are issued for the young, elderly and those with respiratory ailments to stay inside. Commercial aviation can grind to a halt.

Hynix Semiconductor Inc., the world's second-biggest maker of computer memory chips, said it has to step up its filtration systems to keep the air clean at its sensitive production lines in South Korea.

China is likely to suffer more severe sandstorms than normal this spring because of an unusually dry winter, the country's media reported in January.

Beijing, which had 17 sandstorms in the spring of 2006, has pledged to hold a sandstorm-free Olympics in 2008 and has begun campaigns to repair denuded land and rein in over-grazing and over-logging.

Interesting to see that China only addresses these issues when they are in the spotlight. Such moves also go to prove the man-made nature of the problem. Over-grazing is all linked to tragedy of the commons related issues.

South Korea said in December it has reached a deal with Mongolia and China to set up more monitoring stations for dust storms. Environmentalists said it will take a huge amount of money to contain desertification in China's arid regions.

Here in lies the problem - there are many theoretical economics papers that look at this sort of issue. It is good to see a good real life example trans-boundary pollution and how hard the solution will be to find.