Work in progress
The relationship between environmental variability, risk preferences and institutional regimes for the extraction of renewable resources
Species and fleet dynamics in ecosystem-based management
(with J.C. Villaseñor)
Water market dynamics in the presence of environmental variability
(with A. Ayres)
The social value of hurricane forecast
(with Ivan Rudik)
Public preferences on engineered and nature-based coastal adaptation infrastructure (with C. Dario, and D. Kelly)
Capturing the Co-Benefits of Conservation
(with C. Costello and D. Kaffine)
Conservation actions typically focus on securing public goods, but they often also create private spillover co-benefits. For example, protecting open space may increase the values of adjacent properties and protecting a coral reef may increase fishing opportunities outside. These privately-captured co-benefits can be substantial, but are rarely tapped to help lower the overall cost of the original conservation intervention. One reason, we argue, is that doing so is difficult: While co-beneficiaries are easily convinced of the benefits of the conservation intervention, they are not obliged to pay for it, and so usually free-ride and enjoy these benefits gratis. We propose an approach called the Co-benefits Coordination Device (CCD), which allows the conservationist to capture some of these co-benefits. This approach can dramatically lower the cost of conservation while being incentive compatible for all parties involved, effectively allowing the co-benefits of conservation to be shared between the conservationist and co-beneficiaries. Under incomplete information – for example if the conservationist does not know the private co-benefits to adjacent landowners with certainty – the CCD can still lower the cost of conservation, but a trade-off emerges between reducing the cost of conservation and the risk of a conservation project not going forward. As this risk is tied to scientific uncertainty, our results highlight that reducing scientific uncertainty can benefit conservationists when they are bargaining with private property owners. We illustrate the use of this mechanism in a simple terrestrial wetlands conservation example and discuss its application in several other conservation settings.
Natural Disasters in Common Property Regimes: The Case of the Chilean Tsunami
[Under Review at the Journal of Environmental Economics and Management]
Developing countries tend to suffer the most from natural disasters, but the mechanisms underlying this outcome are poorly understood. I postulate that the lack of strong and well-defined property rights for renewable resources is a factor increasing the impacts of disasters. I explore this claim by examining investment patterns across institutional regimes in Chilean small-scale fisheries before and after a tsunami in 2010. The results indicate important links between more common regimes and excessive investment increasing the cost of the tsunami. This paper contributes to the ongoing work on the economic impact of natural disasters and provides an argument for how institutional regimes can be used as adaptation strategies.
Sharing is not caring
(with O. Liu)
[R&R at Frontiers in Marine Science]
Political arrangement of the ocean creates perverse incentives that lead to the overexploitation of transboundary resources, when compared to the social optima. In this paper, we hypothesize that transboundary resources in the ocean must be subject to more aggressive extraction and in worse conservation status. We formalize this intuition with a theoretical model of resource extraction and then test these claims empirically by examining global fisheries. We compile a novel dataset that that traces the spatial distribution of the most important fisheries globally, and show that shared fisheries are in worse shape than those contained in single economic exclusive zones, even in the presence of extraction agreements and modern management practices. This paper alleviates the surprisingly lack of evidence regarding these international dynamics, and also raises concern as to how future changes to habitat suitability due to climate change may affect and even jeopardize the status of internationally shared natural resources; particularly fisheries.
The Economic Impact of Modern Piracy on Global Shipping
(with G. McDonald)
Maritime transport has been historically susceptible to piracy. Rough assessments of the impact of modern piracy point to significant losses per year, with most encounters taking place in some of the most important shipping routes globally. In this paper, we unify the sparse theoretical literature with data available for both shipping voyages and pirate encounters to credibly assess the effect of piracy on the shipping industry. We explore theoretical insights to account for strategic behavior based on observed pirate encounters, then compile and analyze a unique geospatial dataset to test those insights. The dataset includes high spatial and temporal resolution information on pirate encounters, individual vessel tracks, and weather at sea. Our results establish the response of the shipping industry to pirate encounters, showing how the reported presence of pirates along a given route increases both the individual and aggregate cost of transportation, as well as its environmental impact, with major implications for the shipping industry at a global scale. Link
A Contingent Valuation of Hurricane Forecast Improvement
(with D. Letson, B. McNoldy, P. Mozumder, and M. Varkony)
[Forthcoming at the Bulletin of the American Meteorological Society]
Hurricanes are the costliest type of natural disaster in the United States. Every year, these natural phenomena destroy billions of dollars in physical capital, displace thousands, and greatly disrupt local economies. While this damage will never be eliminated, the number of fatalities and the cost of preparing and evacuating can be reduced through improved forecasts. The degree to which more accurate forecasts enable better adaptive actions in the face of a hurricane, and thus reduce its negative impact, can be understood as the value of forecast hurricane improvement. By integrating atmospheric modeling and econometrics in a large-scale contingent valuation experiment, we establish that vulnerable populations value further improvements in forecast accuracy, and that they value wind speed the most. Our study focuses on areas recently hit by hurricanes in the United States, but the implications of our results can extended to tropical cyclones globally. In a world where the intensity of hurricanes is expected to increase and research funds are limited, these results can inform relevant agencies regarding the effectiveness of different private and public adaptive actions, and the value of publicly funded hurricane research programs.
Adaptation Infrastructure and its Effects in Property Values in the Face of Climate Impacts
(with D. Kelly)
We evaluate the effect of climate adaptation infrastructure investments on property transaction prices, using data on over four hundred thousand property transactions and more than two hundred adaptation infrastructure projects in the Miami-Dade county, an area that is highly vulnerable to sea level rise due to climate change. Using a difference-in-differences estimator, we find significant gains in property values after completion of infrastructure projects. These gains are concentrated in areas 0-200 meters from the boundary of the project polygon. We then calculate the return on investment for the adaptation infrastructure projects. Summing over a large number of properties protected by each project results in an aggregate benefit net of adaptation cost of about $20 million per project, and about $3 billion in aggregate net benefits for all projects. Most projects generated positive net benefits, indicating that the vast majority of adaptation efforts are being placed in areas of need that pass the benefit-cost test.
Ovando D., Liu, O., Molina, R., & Szuwalski, C. 2021. Models of Marine Protected Areas Must Explicitly Address Spatial Dynamics. Proceedings of National Academy of Sciences Link.
Costello, C. & Molina, R. 2021. Transboundary marine protected areas. Resource and Energy Economics, 65: 101239. Link
Palacios-Abrantes, J., Herrera-Correal, J., Rodriguez, S., Brunkow, J., & Molina, R. 2018. Evaluating the bio-economic performance of a callo de hacha (Atrina maura, Atrina tuberculosa & Pinna rugosa) fishery restoration plan of La Paz cove, Mexico. PLOS ONE 13(12): e0209431. Link
Liu, O., Molina, R., Wilson, M., & Halpern, B. 2018. Global opportunities for mariculture development to promote human nutrition. PeerJ 6:e4733; DOI 10.7717/peerj.4733. Link
Molina, R., Cerda, R., González, E., & Hurtado, F. Simulation model of the scallop (Argopecten purpuratus) farming in northern Chile: some applications in the decision making process. Latin American Journal of Aquatic Resources, 40(3): 679-693. Link
Norambuena, R., González, E., Molina, R. & Gomez, A. 2017. Impacts of Climate Change on Marine Fisheries and Aquaculture in Chile (Chapter 10 – Aquaculture). In: Phillips, B. & Pérez, M. (eds) The Impacts of Climate Change on Fisheries and Aquaculture. John Wiley & Sons, Inc., Hoboken, NJ, USA.
González, E., Norambuena, R., Molina, R. & Thomas, F. 2013. Evaluación de potenciales impactos y reducción de la vulnerabilidad de la acuicultura al cambio climático en Chile [Potential Impacts and Reduction of the Aquaculture Vulnerability to Climate Change in Chile]. In: Cambio climático, pesca y acuicultura en América Latina: Potenciales impactos y desafíos para la adaptación. Taller FAO/Centro de investigación Oceanográfica en el Pacifico Sur Oriental (COPAS), Universidad de Concepción, Concepción, Chile. FAO Actas de Pesca y Acuicultura. No. 29. Roma, FAO, 275-335p. Link