HUDWINK

Hawaii's Unsustainable Development:

Water, Invasives, and Natural Capital (HUDWINK)

Oahu from the air

Welcome to HUDWINK

Water Issues (Clio 2008 updated paper is here)

Invasive Species

Overview

Brown Treesnake (Boiga irregularis)

Miconia calvescens

Coqui frog (Eleutherodactylus coqui)

Other Spatial Models

SURVEY RESULTS

WHO WE ARE

Links to Related Sites

This webpage is designed to provide information about academic research on the state of Hawaii's natural capital and threats to that capital.

This includes research on institutional development and governance of natural resources:

From Rites to Rites: The Co-evolution of Political, Economic and Social Structures (Kaiser and Roumasset 2007), under review

Our work investigates the role of forest conservation in preserving water supply, water quality, and near-shore resources. Water quality and water quantity may be enhanced by both forest conservation and economic price incentives.

One of the most challenging threats facing the sustainability of Hawaii's natural capital is invasive species. We target this topic as an economic problem of minimizing expected damages from potential and existing invaders over time.

Streambank with Miconia Calvescens

We’ve shared our ideas with the media and the public:

Environmental Valuation and the Hawaiian Economy provides an overview of natural capital assets and threats in Hawaii.

Protect Environment to Preserve Economy was written by the Natural Resources Working Group to increase awareness of the role of Hawaii's environment in the health of its economy.

Water Issues

Working paper (updated for World Cliometric Conference, June 2008)

Long Run Outcomes of Conservation Expenditures: Watershed Destruction, Rehabilitation, and Protection in Hawaii by Brooks Kaiser.

The economic value of watershed conservation (2008)

Brooks A. Kaiser, Basharat A. Pitafi, James A. Roumasset and Kimberly M. Burnett

Forthcoming (Mar 2008) in âCoastal Watershed Management,â eds. A. Fares and A. El-Kadi.

Abstract: Watershed conservation creates benefits within and beyond the management area of interest. The magnitude of the benefits also depends considerably on economic policies accompanying conservation measures. Direct benefits come from biodiversity protection, improved recharge, and the improved quality of ground and surface water. Additionally, the health of a watershed has profound implications on near-shore resources, including beaches and coral reefs. In the case of the Ko`olau Watershed on the island of Oahu, Hawaii, total economic benefits are found to be well above costs. The anticipated cost of watershed conservation into the indefinite future has a present value of $43.2 million using a discount rate of 1%. The benefits of watershed conservation stemming from groundwater recharge alone vary widely depending on the assessment of increased recharge but may be more than $900 million provided that conservation is accompanied by pricing reform. Benefits to near-shore resources (including the avoidance of beach closures and reef sedimentation) range from $4.2 million to $22.0 million even before accounting for flood and sewage-spill damages in March, 2006.

VALUING WATERSHED CONSERVATION FOR GROUNDWATER AND NEARSHORE ECOLOGY (2005)

Brooks A. Kaiser and James A. Roumasset

AWRA SUMMER SPECIALTY CONFERENCE Proceedings (refereed), 2005

ABSTRACT: US resource policy has acknowledged the connection between forest resources and water resources from the inception of the USDA Forest, but it is often overlooked in short run policy decisions. In Hawaii, these interconnected resources led to the establishment of the Ko`olau Mountains Conservation District in the early 1900s in order to improve water supplies. This early action on the part of the state has enabled today a healthy watershed. The health of the watershed, however, is now under threat from incremental ecosystem change, particularly in the form of invasive species (e.g. pigs (Sus scrofa) and plants (Miconia calvescens)) that change the hydrological properties of the watershed to increase runoff and reduce aquifer recharge. Economic costs of reduced recharge in the face of rising water demand from a growing population are potentially large, with previous research valuing the potential loss in the billions of dollars (NPV). We use spatial analysis of the water balance in the Ko`olaus to relate land use and land cover to recharge and runoff and we simultaneously explore the risk of degradation of the forest quality. Using this information, we examine how much of an economic return forest conservation expenditures may produce in the form of benefits of reducing runoff to near shore resources by relating conservation land to reef quality, as an addition to the benefits in groundwater conservation.

Mitigating Runoff as Part of an Integrated Strategy for Nearshore Resource Conservation (2005)

Brooks A. Kaiser with Basharat A. Pitafi and James Roumasset

SeaGrant funded Report (NA16RG2254), April 12, 2005.

Abstract: Using runoff as the connecting ecological factor between beach values, reef values, and forest quality, we determine the expected benefits of forest conservation to near-shore resources under the status quo level of conservation as well as under a scenario in which the Ko`olau Mountain Watershed Partnership Plan is fully funded. Combining expert surveys, interpretation of existing literature and data, and new estimation using GIS data on water balance, land cover characteristics, reef characteristics and coral cover, we build nearshore resource (beach and reef) marginal benefit curves, and generate estimates of the expected benefits from conservation expenditures that incorporate the uncertainty of conservation success as well as the uncertainty surrounding ecological connections between nearshore resources and forest resources.

Valuing indirect ecosystem services: the case of tropical watersheds (2002)

Brooks Kaiser and James Roumasset

Environment and Development Economics (2002), 7:701-714 Cambridge University Press

Abstract: Mitigating the harmful effects of development projects and industries (negative environmentalism) is inadequate, especially in resource-dependent economies whose resources are at risk from other forces. While positive environmentalism includes conservation projects, the non-market benefits of such projects are difficult to evaluate. This paper provides and illustrates a method for evaluating the indirect, watershed benefits of a tropical forest, without resorting to survey methods. The conservation of trees prevents a reapportionment from groundwater recharge to runoff that would otherwise occur. The value of the water saved is then valued at the shadow prices obtained from an optimizing model. An illustration of the model shows that watershed conservation projects may have very high payoffs, even before assessing existence values and other forest amenities.

WATER MANAGEMENT AND THE VALUATION OF INDIRECT

ENVIRONMENTAL SERVICES (2000)

Brooks A. Kaiser and James A. Roumasset

Interdisciplinary Environmental Review, II(2): 102-122.

Abstract: Comprehensive watershed planning and management requires valuation of the intermediate ecological services provided to the water resources. Valuation of forest cover as an ecological service is discussed in the context of three levels of decision-making, and illustrated for the Pearl Harbor/Koâolau watershed (Hawaiâi). Objectives of planning such as sustainable development do not require new criteria but augmentation of existing methods of income accounting and project valuation. Full income valuation implies that the value of water should incorporate the value of maintaining contributory degradable ecological capital. Valuation does not require using survey methods, even when the usual alternatives (hedonics, etc.) are not applicable.

Efficient Water Allocation with Win-Win Conservation Surcharges: The Case of the Ko'olau Watershed

Brooks A. Kaiser, Wetinee Matsathit, Basharat A. Pitafi, and James A. Roumasset

Abstract: We consider the case where the quality of one natural resource conveys economic benefits to the available quantity of another natural resource. Policy decisions regarding funding of conservation should be based on the interconnected benefits to both assets. Imperfect pricing of the downstream resource may lead to an underestimation of conservation benefits, and, by promoting inefficient use of that resource, reduce the effectiveness of conservation policy. We describe a model of optimal control for the downstream resource that relies on the quality of the upstream resource, which in turn depends on conservation spending. We apply this model to the case of the Pearl Harbor Aquifer and the KoÂ´olau Mountain Conservation District on the island of Oahu, Hawaii. Efficient pricing that incorporates the uncertainty of an adverse event's occurrence increases social welfare even in cases where the probability of the adverse event is low and expected damages are small.

Efficient Groundwater Pricing and Intergenerational Welfare: The Honolulu Case

Basharat A. Pitafi and James A. Roumasset

Abstract: Proposals for marginal cost water pricing have often been found to be politically infeasible because current users will have to pay a higher price even though future users will be better off. We show how efficiency pricing can be rendered Pareto-improving, and thus politically feasible, by compensating the users suffering a loss due to higher prices. We provide a method for determining efficient spatial and inter-temporal water management for a system with water demand at several different elevations supplied from a renewable coastal aquifer, which is subject to salinity if over-extracted. We calibrate and numerically solve the model for the Honolulu freshwater market, to obtain efficient prices and quantities, and to determine welfare effects of the change from the current system of pricing at cost to a system of efficiency pricing. We estimate that pricing at full marginal cost results in current, high-elevation consumers being slightly worse off for the first 57 years, amounting to a present-value loss of about $34 million. Current low-elevation consumers benefit from reduced distribution costs and all future consumers benefit from deferring of desalination costs, by more than $441 million in present value terms. This potential Pareto improvement can be converted into an actual Pareto improvement by compensating the losing consumers through block pricing, with initial blocks given free of charge and the cost of the free block charged to the welfare-gaining consumers who are better off even after providing the compensation.

Invasive Species

Overview

Brooks A. Kaiser

This is a powerpoint overview of the economics of invasive species, presented to a Conservation Biology class at Vassar College (Feb 2004)

Trade in the Pacific

On the Garden Path: an economic perspective on prevention and control policies for an invasive species, Choices, 21(3) 2006. Available online (external link)

Brooks A. Kaiser

Choices, 21(3)

Prevention, Eradication, and Containment of Invasive Species: Illustrations from Hawaii (2006)

Kimberly M Burnett, Brooks A Kaiser, Basharat A. Pitafi, and James A Roumasset

Agricultural and Resource Economics Review 35(1): 63-77

Abstract: Invasive species change ecosystems and the economic services such ecosystems provide.

Optimal policy will minimize the expected damages and costs of prevention and control. We seek to explain policy outcomes as a function of biological and economic factors, using the case of Hawaii to illustrate. First, we consider an existing invader, Miconia calvescens, a plant with the potential to reduce biodiversity, soil cover, and water availability. We then examine an imminent threat, the potential arrival of the Brown treesnake (Boiga irregularis). The arrival of the snake in Guam has led to native bird extirpations, power outages, and health costs.

Brown Treesnake (Boiga Irregularis)

Spatial Economic Analysis of Early Detection and Rapid Response Strategies for an Invasive Species (2007)

Brooks A. Kaiser and Kimberly M. Burnett

Under review

Abstract: Economic impacts from invasive species, conveyed as expected damages to assets from invasion and expected costs of successful prevention and/or removal, may vary significantly across spatially differentiated landscapes. We consider the effect of these spatial differences on early detection and rapid response (EDRR) policies, commonly exploited in the management of potential invaders around the world, for the Brown treesnake (Boiga irregularis) in Oahu, Hawaii. EDRR consists of search activities beyond the ports of entry, where search (and potentially removal) efforts are targeted toward areas where credible evidence suggests the presence of an invader. EDRR costs are a spatially dependent variable related to the ease or difficulty of searching an area, while still assuming damages to be a population dependent variable. We find that optimally applied EDRR that integrates the costs, damages, and biological parameters of the snakesâ potential presence can save the island $270m in present value losses to social welfare over 30 years.

Beyond the Lamppost: Optimal Prevention and Control of the Brown Tree Snake in Hawaii (2007)

Kimberly M. Burnett, Sean DâEvelyn, Brooks A. Kaiser, Pornatwee Nantamaniskarn, and James A. Roumasset

Forthcoming, Ecological Economics

Abstract: We develop an integrated model for the prevention and control of an invasive species. The generality of the model allows its use for both existing and potential threats to the system of interest. The deterministic nature of arrivals in the model enables clear examination of the tradeoffs inherent when choosing between prevention and control strategies. We illuminate how optimal expenditure paths change in response to various biological and economic parameters for the case of the Brown Tree Snake in Hawaii. Results suggest that it is more advantageous to spend money finding the small population of snakes as they occur than attempting to prevent all future introductions. Like the drunk that looks for his keys only where the light is, public policy may fail to look âbeyond the lamppostâ for snakes that have already arrived but have not yet been detected. Actively searching for a potential population of snakes rather than waiting for an accidental discovery may save Hawaii tens to hundreds of millions of dollars in future damages, interdiction expenditures, and control costs.

Optimal Public Control of Exotic Species: Preventing the Brown Tree Snake from Invading Hawaiâi (2002)

Brooks A. Kaiser and James A. Roumasset

Unpublished manuscript (2002)

Abstract: This paper develops a theoretical model for the efficient establishment of economic

policy pertaining to invasive species, integrating prevention and control of invasive species

into a single model of optimal control policy, and applies this model to the case of the

Brown tree snake as a potential invader of Hawaii.

Brown tree Snake on Power Lines in Guam

Miconia Calvescens

Invasive Species Control over Space and Time: Miconia calvescens on Oahu, Hawaii (2007)

Kimberly M. Burnett, Brooks A. Kaiser and James A. Roumasset

Journal of Agricultural and Applied Economics, October 2007.

Abstract: The optimal size and location of an invasive species population depends upon spatially differentiated biological growth, economic costs and damages. Though largely absent from most economic models, spatial considerations matter in that the likelihood and magnitude of the invasion vary spatially and because the threatened assets may be unevenly distributed across space. We map the current and future populations of an invasive species, Miconia calvescens, on Oahu, Hawaii, and the potential damages to water quantity, quality, and endangered species habitat, weighing these against treatment costs. We find that optimal densities vary from approximately 1% to 18% cover throughout the island.

Miconia calvescens control

Economic Lessons from Control Efforts for an Invasive Species: Miconia calvescens in Hawaii (2007)

Kimberly M. Burnett, Brooks A. Kaiser, James A. Roumasset.

Journal of Forest Economics 13(2-3):151-167

Abstract: Once established, invasive species can rapidly and irreversibly alter ecosystems and degrade the value of ecosystem services. Optimal control of an unwanted species solves for a trajectory of removals that minimizes the present value of removal costs and residual damages from the remaining population. The shrubby tree, Miconia calvescens, is used to illustrate dynamic policy options for a forest invader. Potential damages to Hawaiiâs forest ecosystems are related to decreased aquifer recharge, biodiversity, and other ecosystem values. We find that population reduction is the optimal management policy for the islands of Oahu, Maui, and Hawaii. On the island of Kauai, where tree density is lower and search costs higher, optimal policy calls for deferring removal expenditures until the steady state population is reached.

Control of invasive species: lessons from miconia in Hawaii (2006)

Brooks A. Kaiser, Kimberly M. Burnett, and James A. Roumasset

15th Australian Weeds Conference: Papers and Proceedings, Adelaide, South Australia Council of Australian Weed Societies, C. Preston, J.H. Watts, and N.D.Crossman, eds. Pp. 663-667. (Refereed)

Economic impacts of non-indigenous species: Miconia and the Hawaiian economy (2006)

Brooks A. Kaiser

Euphytica 148(1-2): 135-150

Abstract: Imperfect scientific information regarding potential invasiveness, differences between private and public outcomes for individual decisions regarding planting, and inadequate prevention activity combine to impose costs through a change in native ecosystems susceptible to invasion by hardy, rapidly reproducing non-indigenous species. Concepts and tools from economic theory that may improve policy decisions are explored through the specific example of Miconia calvescens in Hawaii. Rapid expansion of Miconia calvescens, an ornamental tree introduced to several Pacific Islands over the last century, threatens local watersheds, endangered species, and recreational and aesthetic values in the Hawaiian and Society Islands. Potential welfare losses from the unchecked spread of Miconia in Hawaii are illustrated. Policy options investing

ated include accommodation of these losses, efforts at containment, or eradication. Estimates are determined through an optimal control model describing the potential expansion of the weed and its control costs and damages. Results suggest that cost-effective policies will vary with the level of invasion as well as the expected net benefits from control efforts.

Miconia Control Efforts, Maui

Coqui Frog

Economic Impacts of E. Coqui frogs in Hawaii (2006)

Brooks A. Kaiser and Kimberly M. Burnett

Interdisciplinary Environmental Review, 8(2): 1-12

Introduction: Hawaiiâs geographical isolation has resulted in the development of unique and fragile ecosystems in which the arrival of a new species may create dramatic changes in the ecology, and now the economy, of the islands. Successful establishment rates for new species before the arrival of humans in the early 1^st millennium AD may have been as low as one new species every 10,000 years (Loope, 1997). Only one terrestrial mammal, a bat (now extinct), reached the island chain without human assistance. Many other suborders are unrepresented; for example, the islands have no native snakes or frogs.

Today, combined purposeful and accidental arrival and establishment rates are in the order of hundreds per annum. The coqui (Eleutherodactylus coqui) is one of two species of small tree frogs that has arrived and become established in Hawaii since the 1980s. The frog has no predators and the islands are postulating both ecological and economic impacts. The male emits a loud âkokeeâ mating call at night that dominates the audioscape where it occurs. We describe the anticipated effects and quantify a lower bound estimate of damages generated by reductions in property values due to the current invasion.