CBBCILecture12 5 02

Poverty traps and their implications for tropical biodiversity conservation: 

Poverty traps and their implications for tropical biodiversity conservation December 5, 2002 Chris Barrett Cornell University Poverty and Biodiversity Distinguished Lecture Conservation International Washington, DC

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Different Perspectives on Poverty The traditional, cross-sectional, “snapshot” view: Headcount and poverty gap (FGT) measures: in US ~33 million below poverty line (11.7%) in Kenya, it’s 44.1% and in Madagascar, 69.6% The emerging, dynamic, “video” view: Persistence measures: in US <25% of poor remain poor for the whole year. Median poverty spell in US is only 4.5 months despite high poverty line ($18,104 for family of 4) Vulnerability measures: Estimated risk of falling below poverty line in future

Poverty traps: The dynamic view: 

Poverty traps: The dynamic view Poverty traps = Poverty spells that persist for long periods Foster hopelessness and insecurity Intergenerational transmission via child labor, education and undernutrition Discourages investment “Can’t get ahead for falling behind” (Barrett and Carter, Choices 2001-2)

Poverty dynamics: Some crude comparisons: 

Poverty dynamics: Some crude comparisons

Transition probabilities inCôte d’Ivoire, 1993-95: 

Transition probabilities in Côte d’Ivoire, 1993-95 The probability of being poor next year depends heavily on whether one is poor this year. Income mobility can be significant in the middle and upper ranges of the income distribution, but not much at the bottom.

Poverty traps and livelihood strategies in Rwanda: 

Poverty traps and livelihood strategies in Rwanda

Assets and poverty traps: An Ethiopian pastoralist example: 

Assets and poverty traps: An Ethiopian pastoralist example 17-year herd dynamics data on Boran herders suggest a low-level equilibrium trap below 10-12 head/hh with a high-level equilibrium of 40-60 head/hh (Lybbert et al. 2002)

Relief traps: 

Relief traps Poverty traps also give rise to relief traps for donors, who are trapped in humanitarian assistance …

… while agricultural research funding declines: 

… while agricultural research funding declines

Attacking poverty traps is the right strategy, inethical, economic and environmental terms: 

Attacking poverty traps is the right strategy, in ethical, economic and environmental terms

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The causality of poverty traps Longitudinal, household-level data enables new, careful study of poverty dynamics and related “best bets” on how to combat poverty traps Four key sources of poverty traps: Risk exposure and limited risk management capacity Meager stocks of productive assets Rudimentary production/processing technologies Weak markets and nonmarket institutions

Risk exposure and limited risk management capacity: 

Risk exposure and limited risk management capacity 1) Reduce exposure to (asset, health, production and price) risk … threatens nature and people 2) Improve tools for managing risk -ex ante through diversification opportunities, information systems, preventive health care, mobility, stabilization -ex post through safety nets To facilitate exit from poverty traps, must learn how best to:

Meager stocks of productive assets: 

Meager stocks of productive assets 1) Build up stocks of natural capital (land, livestock, soil quality) via stock raising projects, improved nutrient recycling, etc. 2) Build up human capital through improved child nutrition and education 3) Provide physical capital through improved rural finance, infrastructure, etc. To facilitate exit from poverty traps, must learn how best to:

Rudimentary technologies: 

Rudimentary technologies Improve productivity of existing asset stock (improved genetics, disease management, integrated crop-livestock systems), especially through agricultural intensification Identify and promote effective “transition technologies” Finance to facilitate adoption of available technologies (case of SRI in Madagascar) and improved NRM practices To facilitate exit from poverty traps, must learn how best to:

Weak markets and nonmarket institutions: 

Weak markets and nonmarket institutions Reduce fixed costs of market access Reduce costs of and barriers to intermarket transport and storage Implement competition policy in rural areas Identify and support tenurial institutions that safeguard access to key natural resources Foster group-based marketing, finance and innovation effectively To facilitate exit from poverty traps, must learn how best to:

The Poverty Dynamics – Tropical Biodiversity Conservation Nexus: 

The Poverty Dynamics – Tropical Biodiversity Conservation Nexus There is strong relationship between rural poverty dynamics and natural resource degradation in the tropics: - bidirectional causality between these phenomena - mutual causality by broader political economy factors - weak institutions (governments, markets and communities) lead to weak incentives for resource conservation, and to pervasive enforcement and coordination problems

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Example 1: Rangelands in East Africa Generalized versus localized degradation food aid, spatial concentration of herds, violence (2) Animal disease control methods and inter-species transmission (3) Deforestation due to supplemental feeding during drought, food aid form, charcoal manufacturing (4) Human-wildlife conflict in times of stress

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Example 2: Commercialization of Non-Timber Forest Products Morocco’s argan forest (Lybbert et al.): commercial boom hasn’t induced forest conservation nor helped the poor: biology and markets matter Chambira palm in the Peruvian Amazon (Coomes): The better off can afford to plant chambira and to keep longer fallows: wealth and tenure matter Markets insufficient for conservation and poverty reduction

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Example 3: Sustainable Agricultural Intensification Once one controls properly for agro-ecological variability, Ivorien rice farmers appear very efficient Even high-yielding, low external input technologies not adopted when interseasonal finance is not available (SRI in Madagascar). Improved on-farm NRM requires the “five ins”: investment based on institutions, information, inputs and incentives Absent intensification, xtensification inevitable. Can help induce intensification by closing frontiers through parks and protected areas, but that’s insufficient.

Summary: Oikos: 

Summary: Oikos Both people and the biosphere are suffering in most of the tropics today. Understanding the interrelationship between dynamic ecological and economic processes is a daunting but important challenge. Both require significant investment in assets, technologies, market and nonmarket allocation mechanisms and risk management capacity