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Creating markets for habitat conservation when habitats are heterogeneous, Volume 1
Author:Chomitz, Kenneth M.; Thomas, Timothy S.; Salazar Brandao, Antonio; Country:Brazil;
Date Stored:2004/10/27Document Date:2004/10/01
Document Type:Policy Research Working PaperSubTopics:Wetlands; Environmental Economics & Policies; Water Conservation; Climate Change and Environment; Banks & Banking Reform; Forestry
Language:EnglishRegion:Latin America & Caribbean
Report Number:WPS3429Collection Title:Policy, Research working paper series ; no. WPS 3429
Volume No:1  

Summary: A tradable development rights (TDR) program focusing on biodiversity conservation faces a crucial problem defining which areas of habitat should be considered equivalent. Restricting the trading domain to a narrow area could boost the range of biodiversity conserved but could increase the opportunity cost of conservation. The issue is relevant to Brazil, where TDR-like programs are emerging. Current regulations require each rural property to maintain a forest reserve of at least 20 percent, but nascent policies allow some tradability of this obligation. The authors use a simple, spatially explicit model to simulate a hypothetical state-level program. They find that wider trading domains drastically reduce landholder costs of complying with this regulation and result in environmentally preferable landscapes.

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