Cesar2000-Economics of Coral Reefs.pdf

marginal cost (million US$/% coral cover)
40
35
30
25
20
15
10
5
0
0 5 10 15 20 25
improvement in coral abundance (%)
Figure 1. Montego Bay intervention costs (Source:
Ruitenbeek et al. 1999a).
2.4 The Identification of Least-Cost Interventions
— Montego Bay Marine Park
Similar to the Coral-Curaçao and Coral-Maldives models,
Ruitenbeek et al. (1999a, see also Ridgley et al.
1995; Ridgley & Dollar 1996; Ruitenbeek et al. 1999b)
applied a fuzzy logic methodology to identify the leastcost
interventions that would lead to an increase in coral
reef abundance within the Montego Bay Marine Park.
Fuzzy logic procedures are utilised within an ecological
reef impact model to generate a complex dose-response
surface that models the relationship among coral reef
abundance and various inputs within the context of the
abiotic marine environment. This is linked to a nonlinear
economic model describing current and future
economic activities within eight sectors, technical and
policy interventions, and pollution loads in Montego
Bay. Optimisation provides insights into the most costeffective
means for protecting coral reefs under different
reef quality targets.
Figure 1 shows the intervention costs associated with
a range of coral reef improvements. In Montego Bay,
Jamaica, up to a 20% increase in coral abundance may
be achievable through the use of appropriate policy
measures with a present value cost of US$ 153 million
over 25 years (Ruitenbeek et al. 1999a). The specific
policy measures considered included installation of a
sediment trap on the Montego River, the planting of
trees in the upper watershed, installation of a waste
aeration system, installation of a large-scale centralised
treatment facility, agricultural extension to provide
waste reducing technologies, installation of an outfall
and pump station, improved household solid waste collection,
and implementation of a hotel tax. Some interventions
were found to be relatively cost-effective. For
example, household solid waste collection, installation
of an outfall, and use of a sediment trap on the Montego
River would impose a present value cost of US$ 12
million and result in an improvement in coral reef cover
of over 10% (Ruitenbeek et al. 1999a).
One key demonstration of the research was that conventional
methodologies for measuring cost-effectiveness
may result in sub-optimal policy solutions when
applied to complex systems. This is because cost-effectiveness
analyses tend to assume the separability and
independence of individual interventions and the ability
to treat benefits separately from costs (often when benefits
can not be defined). When dealing with highly complex
systems such as coral reefs, synergisms, feedbacks
and other interdependencies between individual interventions
and the resulting level of coral reef health can
invalidate the recommendations arising from individually
assessed policy interventions that are assumed to be able
to be applied in a sequential, step-wise fashion. For
example, reforestation was found to be part of the optimal
intervention set at coral reef improvement targets of
14% and 20%, but was not part of the optimal intervention
set for a 15% or 16% improvement (Ruitenbeek et
al. 1999a). As noted by Ruitenbeek et al. (1999a), this
means that coral reef health targets, in reference to the
extent of the derived benefits, must be established before
policy interventions are pursued.
2.5 Integrating the Results for Montego Bay
towards an Efficient Level of Intervention
A synthesis of the separate coral reef valuation studies
for the Montego Bay Marine Park allows one to arrive at
a total value and a net marginal benefit (or price) function
(Ruitenbeek & Cartier 1999). In order to arrive at a
ECOLOGICAL ECONOMIC DECISION SUPPORT MODELLING FOR THE INTEGRATED COASTAL ZONE MANAGEMENT OF CORAL REEFS
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