9a ‘Why do we need to control industries based on natural resources?’ (200 words)
The World Trade Organization defines natural resources as “stocks of materials that exist in the natural environment that are both scarce and economically useful in production or consumption, either in their raw state or after a minimal amount of processing”. Given this definition, it is easy to identify the potential for over exploitation of natural capital.
Traditionally, natural recourses were viewed as free ecological goods (Smith, 1776), however, this approach has lead to wide scale environmental degradation and depletion (Pearce et al., 1993; Costanza et al., 1997; Food and Agriculture Organization of the United Nations, 2006; Asafu-Adjaye, 2009; Rockström et al., 2009; Creech, 2010; United Nations Development Programme, 2010; Food and Agriculture Organization of the United Nations, 2011).
Long term fisheries exploitation has resulted in a decline in global fish stocks and the total collapse of some fish species (Döring et al., 2008; Scipps Institute of Oceanography, 2008). Despite overwhelming evidence of overfishing induced population declines and internationally established fishing quotas, over fishing continues in some sectors by some countries (Döring et al., 2008; Murray et al., 2009).
Natural tourist attractions are unevenly distributed throughout the world resulting in population concentration that establishes tourism as an economically important industry (Garay et al., 2011; Holzner, 2011). It has been observed that environmental impacts associated with tourism has not been well researched, but is evident amongst some locations (Mohammadi et al., 2010; Zhong et al., 2011). Regulatory controls are needed to mitigate such effects.
The link between forestry, or the clearing of forests and climate change has been well established (Food and Agriculture Organization of the United Nations, 2006; Depro et al., 2008; Butler et al., 2009; Rockström et al., 2009; Food and Agriculture Organization of the United Nations, 2011). Notwithstanding, the removal of forests persists despite international pressures for tighter regulatory control.
Industries based on natural resources are primarily responsible for the associated environmental degradation, nevertheless an opportunity exists to these sectors to potentially forestall further environmental decline (Madden, 2012; Sullivan, 2012d).
9B(i) What problems arise when we try to commercialise natural resource-based industries? Give examples. (80 words)
- Over exploitation to meet demand (Sullivan, 2012a)
- Commercial dependence leading to poor management decisions (Sullivan, 2012b)
- Externalities of exploitation
- Ecosystem equilibrium disturbance resulting in Population collapse / successional changes (Savenkoff et al., 2007)
Dr Paul Dayton (2008) describes the collapse of the kelp forests as a result of fisheries exploitation. Unregulated overfishing of apex predators such as black bass quickly exhausted localised populations resulting in an explosion in lobsters and abalone populations (1930s). Extensive exploitation of lobsters (1950s) and abalone (1970s) resulted in localised extinction. With the removal of predators that compete for space in the ecosystem, sea urchin populations have expanded to carrying capacity and quickly over grazing the kelp, collapsing the entire ecosystem (Scipps Institute of Oceanography, 2008).
9B(ii) In managing natural resources, what can governments do to ensure that the private sector is responsible for its actions? (80 words)
- Don’t allow self regulation: Experience has shown us that self regulated industries are open to corruption and mismanagement.
- Incentives must be offered for sustainable management. Carrots such as the Payment for Ecological Services, Environmental bonds and offsets make ecologically sustainable manufacturing and agriculture more attractive to producers and consumers (Madden, 2012; Sullivan, 2012b, 2012c, 2012d).
- Legislation and regulatory enforcement: The stick that goes with the carrot must be hefty financial and legal punishment for infringing the laws designed to protect the ecosystems that support us. There needs to be increased enforcement rates to stop unacceptable behaviour (Madden, 2012; Sullivan, 2012b, 2012c, 2012d).
9B(iii) What risks are faced by countries which rely on tourism? How can these risks be reduced?
- The very resources that attract tourists become degraded and unattractive.
- Resources are not evenly distributed throughout the world, causing an unbalanced loading of tourism.
- Future tourism will be adversely affected as travel becomes increasingly difficult due to oil shortages resulting in collapsed tourism industries and economies.
- Mitigating strategies and offsets can be developed ahead of time.
- Opportunities exist for emerging technologies and industries.
- Increased effective management to reduce possible impacts from negative externalities.
- Introducing maintenance and management fees to pay for above.
Asafu-Adjaye, J. (2009). Environmental economics for non economists: techniques and policies for sustainable development. (2nd ed.). Singapore: World Scientific Publishing Co. Pty. Ltd.
Butler, R., Laurance, W., & mongabay.com (2009). Will palm oil drive deforestation in the Amazon? Retrieved 23 March, 2012, from http://www.commercialpressuresonland.org/press/will-palm-oil-drive-deforestation-amazon
Costanza, R., Cumberland, J., Daly, H., Goodland, R., & Norgaard, R. (1997). An introduction to Ecological Economics. Boca Raton, Florida: CRC Press.
Creech, H. (2010). The Sustainable Development Timeline Retrieved February, 2012, from http://www.iisd.org
Depro, B. M., Murray, B. C., Alig, R. J., & Shanks, A. (2008). Public land, timber harvests, and climate mitigation: Quantifying carbon sequestration potential on U.S. public timberlands. Forest Ecology and Management, 255(3–4), 1122-1134. doi: 10.1016/j.foreco.2007.10.036
Döring, R., & Egelkraut, T. (2008). Investing in natural capital as management strategy in fisheries: The case of the Baltic Sea cod fishery. Ecological Economics, 64(3), 634-642. doi: 10.1016/j.ecolecon.2007.04.008
Food and Agriculture Organization of the United Nations. (2006). Livestock’s Long Shadow. In Food and Agriculture Organization of the United Nations (Ed.). Rome, Italy.
Food and Agriculture Organization of the United Nations. (2011). The state of the world’s land and water resources for food and agriculture. Rome, Italy.
Garay, L., & Cànoves, G. (2011). Life cycles, stages and tourism history: The Catalonia (Spain) Experience. Annals of Tourism Research, 38(2), 651-671. doi: 10.1016/j.annals.2010.12.006
Holzner, M. (2011). Tourism and economic development: The beach disease? Tourism Management, 32(4), 922-933. doi: 10.1016/j.tourman.2010.08.007
Madden, J. (2012, 8 May). [Topic 9 - Natural resource-based industries; fishing, forestry and tourism].
Mohammadi, M., Khalifah, Z., & Hosseini, H. (2010). Local People Perceptions toward Social, Economic and Environmental Impacts of Tourism in Kermanshah (Iran). Asian Social Science, 6(11), 220-225.
Murray, R., Hird, C., Barrnes, C., Duffield, G., & Lewis, C. (Producer). (2009, 26 April 2012). End of the Line. [Feature Length Docmentary Film] Retrieved 26 April 2012 http://misc.docuwat.ch/videos/planet/end-of-the-line/?channel_id=0
Pearce, D., & Warford, J. (1993). World without End; Economics, Environment and Sustainable Development. New York, New York: Oxford University Press, Inc.
Rockström, J., Steffen, W., Noone, K., Persson, A., Chapin, F., Lambin, E., . . . Foley, J. (2009). Planetary boundaries: exploring the safe operating space for humanity. Ecology and Society, 14(2), 32.
Savenkoff, C., Swain, D. P., Hanson, J. M., Castonguay, M., Hammill, M. O., Bourdages, H., . . . Chabot, D. (2007). Effects of fishing and predation in a heavily exploited ecosystem: Comparing periods before and after the collapse of groundfish in the southern Gulf of St. Lawrence (Canada). Ecological Modelling, 204(1–2), 115-128. doi: 10.1016/j.ecolmodel.2006.12.029
Scipps Institute of Oceanography (Producer). (2008, 10 May 2012). John Dayton: The environmental cost of fishing. [Youtube Video] Retrieved 10 May 2012 http://www.youtube.com/watch?v=uZYVOb11MNE&feature=player_embedded
Smith, A. (1776). The Weath of Nations: Random House, Inc.
Sullivan, C. (2012a, 13 March). [Topic 4 Lecture: Market Systems: Supply and Demand].
Sullivan, C. (2012b, 10 April). [Topic 6 - Economic instruments for environmental management].
Sullivan, C. (2012c, 17 April). [Topic 7 - Ecosystem Good and Services].
Sullivan, C. (2012d, 24 April). [Topic 8 - Economic Development and Sustainability].
United Nations Development Programme. (2010). The Real Wealth of Nations: Pathways to Human Development.
Zhong, L., Deng, J., Song, Z., & Ding, P. (2011). Research on environmental impacts of tourism in China: Progress and prospect. Journal of Environmental Management, 92(11), 2972-2983. doi: 10.1016/j.jenvman.2011.07.011
- Topic 1: The economy and why it matters to the environment (envirorhi.wordpress.com)
- Topic 2: Environmental vs Ecological Economics (envirorhi.wordpress.com)
- Topic 3: Valuing the Environment: Why it is important. (envirorhi.wordpress.com)
- Topic 4: Market Systems: Supply and Demand (envirorhi.wordpress.com)
- Topic 5: Decision Making for Environmental Management (envirorhi.wordpress.com)
- Topic 6: Economic instruments for environmental management (envirorhi.wordpress.com)
- Topic 7: Ecosystem good and services (envirorhi.wordpress.com)
- Topic 8: Environmental Growth and Sustainable Development (envirorhi.wordpress.com)
- Topic 9: Managing Natural Resource Based Industries (envirorhi.wordpress.com)
- Topic 10: The Economics of Water Management (envirorhi.wordpress.com)