I was 23 when I first ventured into rural India as a research assistant to examine how women harvested, traded and earned income from a fruit from the Uppage (Garcinia Cambogia) tree. The seeds were collected for their oil by local women, until markets opened up for the fruit, which had value as a condiment in a neighboring region. This led to changes in demand, and harvest rights began to be auctioned by the government. The Uppage case presents a classic story of access to new markets leading to partial privatization of common property, with consequences for both conservation and income distribution. Of course, I knew little about environmental economics then. But this foray into rural India exposed me to many elements of environment and development problems – the challenges of managing the commons, the possibility of markets leading to overexploitation of resources and growth in employment, the idea of institutional change contributing to multiple winners and losers with poor women being left behind on the bottom rung, and so on. This had a life-changing influence, leading me eventually to branch out and specialize in this area.
The commons have gained much attention, both on theoretical and empirical fronts, in the last 20-odd years (Ostrom, Reference Ostrom1990; Baland and Platteau, Reference Baland and Platteau1996; Dasgupta, Reference Dasgupta, Ghate, Jodha and Mukhopadhyay2008). Growth in this field of enquiry has contributed to rethinking how we manage nature and natural resources in the developing world. In India and Nepal, we might not have seen reforms in the forestry sector if activist groups interested in rural household rights over forests had not also been backed by a growing literature on community management of local natural resources. To achieve their public policy goals of reducing deforestation and degradation, both India and Nepal have implemented large-scale decentralized forest management programs – Joint Forest Management in India and the Community Forestry Programme in Nepal – which attempt to strengthen community rights over forest resources. There are now at least 84,000 Forest Protection Committees in 27 states in India that manage about 17 million hectares (approximately 25 per cent) of India's forests (Balooni and Inoue, Reference Balooni and Inoue2009). Similarly, some 25 per cent of Nepal's forests are managed by 14,000 Community Forestry User Groups (Kanel, Reference Kanel, Ghate, Jodha and Mukhopadhyay2008). While the history of communities using and managing forests goes back a very long way (Shyamsundar and Ghate, Reference Shyamsundar and Ghate2014), the resurrected interest in community-led approaches as a government-backed forestry strategy is relatively new and has been, arguably, bolstered by scholarship on how the commons can be managed by local users. This understanding has emerged from scores of studies undertaken by economists, political scientists and ecologists, among others (see, for instance, publications associated with SANDEE and IFRI).Footnote 11
In South Asia, EDE has been less successful in advancing the use of valuation within a cost-benefit framework for regulating pollution or natural resource use. There are some examples of user fees in protected areas being influenced by travel-cost studies and the use of non-market valuation in water- and sanitation-related pricing, but these examples are few and far between. Valuation studies are often undertaken in contexts where their immediate policy use is not clear. Also, non-market valuation does not enter the regular parlance of policy makers and, unlike in Western countries, cost-benefit analysis is not a very important tool in decision making by environment ministries. Thus, non-market valuation has generally not been very handy as a policy instrument. This is important, of course, because valuation and cost-benefit analyses are core to both teaching and research in environment-development economics; they are the bread and butter of empirical analyses.
As the field of EDE moves forward, valuation studies need to become more ‘usable’. It is clearly not enough to say that net benefits are positive; rather, cost-benefit analyses need to be accompanied by a careful assessment of the opportunities, or ‘openings’ if you will, that would allow these numbers to enter into the policy debate. This brings us to the domain of political and institutional analyses. Thus, as we move forward, environment-development economists need to engage in deeper cross-learning about how reform processes work in the developing world and how they can be informed and influenced by externality theory and non-market valuation.
In the next decades, South Asia will continue to confront traditional economic development challenges related to pollution and resource depletion, as well as new challenges from climate change and deteriorating ecosystem services. Thus, policy makers in South Asia will require a better suite of policy instruments and more efficient implementation strategies. EDE can address these challenges by identifying real problems, expanding its tool kit and partnering with other disciplines.
