Using economic instruments to overcome obstacles to in situ conservation of biodiversity

The leading direct cause of the loss of biodiversity is habitat alteration and disruption. If we are to address this cause directly, we need to find ways of changing the behavior of rural people. Experience has shown that this is done most effectively through the use of economic instruments, ranging from taxes that discourage over-exploitation, to direct payments for conservation activities carried out by rural land-owners or those occupying the land. In many parts of the world, governments provide incentives such as tax breaks to private land-owners. Other countries recognize specific use rights on particular parts of the land, enabling the land-owners to earn appropriate benefits. Since many protected areas have resident human populations, it is especially important that they be encouraged to contribute to the objectives of the protected area, and economic incentives offer an important way of doing so; they might, for example, be given employment in the protected area or in associated tourism activities. Direct payments to farmers for conserving watersheds is becoming increasingly popular, in both developed and developing countries. Improved conservation will require both removing perverse subsidies and developing a wide range of approaches for rewarding land-owners for biodiversity conservation activities.