Incentives for in situ conservation of CWR in Zambia

An assessment of cost effectiveness of in situ conservation options for CWR was carried out in Zambia. Warwick Wainwright (University of Edinburgh), Adam G. Drucker (Bioversity International) and Dickson Ng’uni (Zambia Agriculture Research Institute) report here about results.

Introduction
Conceptual background
Methodology
Key findings
Recommendations

The approach used here extends previous payments for ecosystem services (PES) work applied to the conservation of domesticated agrobiodiversity (see http://tinyurl.com/PACS-info-and-publications) to CWR.
A mixture of private and public good benefits are associated with the provisioning, regulating, cultural and supporting ecosystems services of agrobioidversity. From an economics perspective it is the pervasiveness of such public good values (i.e. positive externalities), which have non-market values associated with them, that is leading to an underinvestment in the maintenance of agrobioidversity and hence a major reason for its loss. Effectively, private good values 1 that can be easily appropriated by individual farmers are being traded-off against unvalued public good 2 ecosystem services that benefit broader society and are much more difficult to individually appropriate.
With no market incentive to conserve agricultural biodiversity in situ or on-farm, much genetic resources conservation occurs as a result of farmer socio-cultural preferences. Yet given the spatial differentiation of the relative costs (farm level) and benefits (national and global) of the maintenance of biodiversity, we increasingly risk losing these precious resources, as poor smallholder farmers not only cannot be expected to alone incur the opportunity costs of their maintenance but may collectively also not be able to do so as at level considered sufficient from a public good conservation perspective.
A solution to this dilemma may be found in the provision of incentives to farmers who conserve agricultural biodiversity on their farms and in surrounding communal lands. The importance of the design and implementation of such positive incentives for the conservation of biodiversity has been explicitly recognized, inter alia, by the Convention on Biological Diversity (Aichi Target 3).
A good understanding of the opportunity costs involved is thus fundamental to ensuring that incentives are set appropriately and will also play a key role in determining the total resources required to implement the conservation programme.
However, there is a fundamental problem to be overcome by the conservation agency (be it governmental or non-governmental) with regard to the identification of such opportunity costs. Given that such costs may vary significantly between farming households (because of different preferences for the species/varieties/breeds in question, different availability of land and labour, etc.) and locations, it is extremely difficult for the agency to know other than in very general terms  what the true opportunity costs might be. By contrast, individual farmers are likely to be well aware of their true opportunity costs 3. Such differences are referred to by economists as “information asymmetries” and the existence of such differences in knowledge can result in farmers having an incentive to exaggerate their true opportunity costs in order to maximize the conservation payments they would receive. This in turn would lead to higher overall conservation costs and, given limited conservation budgets, leaving less funding available for conserving additional threatened varieties. Given that better outcomes could have been achieved if the true opportunity costs had been known by the conservation agency, such outcomes are not considered to be cost-effective.
Competitive tender schemes using auction-based mechanisms have been shown to be capable of tackling the lack of cost-effectiveness arising from the existence of information asymmetries by identifying participating farmers' actual conservation costs. This is because such competitive processes provide farmers with an incentive to reveal their true opportunity costs, as the higher the payment demanded, the lower the probability of being selected to participate in the conservation programme. Accordingly, it is argued that such tender mechanisms are able to maximize the efficiency of PES, relative to fixed price approaches (e.g. where everyone is paid the same unit amount). Although conservation tenders are increasingly being applied in PES settings, especially in developed countries, to the best of our knowledge this study is the first to apply it in a crop wild relative context^.