Cesar2000-Economics of Coral Reefs.pdf

marginal benefit function, relating price to changes in
coral reef abundance, further assumptions were required
regarding the relationship between the categories of
values and coral reef abundance or quality. Specifically, a
linear relationship is assumed between reef quality and
local use values and non-use utility values. This is most
likely not the case, but assuming a less simplified relationship
cannot be justified given our current knowledge.
Only the results of the bioprospecting valuation
model (Ruitenbeek & Cartier 1999) allowed the specification
of a different functional form. As noted by
Ruitenbeek & Cartier (1999), total net marginal values
will likely be over-estimated in some instances and under-estimated
in others.
The total benefit attributed to the coral reefs of the
Montego Bay Marine Park is estimated at US$ 470 million
(table 1). Every 1% change in abundance is likely to
generate a marginal benefit of US$ 10 million or, alternatively,
the marginal price of coral reef is approximately
US$ 23 million/ha (Ruitenbeek & Cartier 1999). Most of
the value is attributed to tourism. Coastal protection and
non-use utility benefits also contribute, but to a much
lesser extent. Existing fisheries and the potential development
of a bioprospecting program have a negligible
effect on marginal values (Ruitenbeek & Cartier 1999).
marginal cost and benefit (million US$/% coral cover)
40
35
30
25
20
15
10
5
13% improvment
0
29 40 50
coral abundance (%)
Figure 2. Montego Bay intervention marginal benefit and
cost curves for the global optimisation solution
(Source: Ruitenbeek & Cartier 1999).
Using the marginal cost function as reported in the
least cost intervention study for the Montego Bay Marine
Park (Ruitenbeek et al. 1999a), in conjunction with
the marginal benefit estimates, allows one to arrive at a
global optimisation (figure 2). An optimal improvement
of coral reef abundance of 13% is suggested (i.e., from
approximately 29% live cover as estimated from model
equilibrium conditions — see Ruitenbeek et al. 1999a
MC
MB
Table 1. Summary of Valuation Results for Montego Bay Coral Reefs (Source: Ruitenbeek & Cartier 1999)
Benefit Price Price
(NPV; million US$) (million US$/%) a (million US$/ha) a
Tourism/recreation 315.00 7.33 17.18
Artisanal fishery 1.31 0.03 0.07
Coastal protection 65.00 1.51 3.54
Local non-use 6.00 0.24 0.56
Visitor non-use 13.60 0.54 1.28
Subtotal 400.91 9.65 22.63
Pharmaceutical bioprospecting (global) 70.09 0.23 0.53
Total (global) 471.00 9.88 23.16
Pharmaceutical bioprospecting (Jamaica) 7.01 0.02 0.05
Total (Jamaica) 407.92 9.67 22.68
a
Marginal benefits shown at typical current reef conditions.
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