Archive for March, 2010

Today’s Guest Moo comes from Manatee, our very first sea-faring cow! Manatee spouts off about the global commons that is Google Streetview…

What am I to make of finding out I’ve made onto Google’s Streetview.  Google awash with cash is going about every street in the land taking pictures (and emitting carbon) so that we can all see what every street in the land looks like. Except they capture not just streets and buildings but people. People like me. Sitting on my wall outside my house one lunch-time recovering from a bout of pounding my local streets in a vain attempt at retaining a modicum of fitness.

My first reaction was no big deal – unlike many who have objected to Google’s efforts as some kind of online paparazzi on a well Googlish type scale.  But then I started to think about it and think about it as an economist.  Economists and especially environmental economists talk a lot of property rights or rather the absence of property rights.  Properly functioning markets infused with well defined property rights will solve most environmental ills some of us believe.  And there is much to commend the prescription.

I started to think about property rights when I thought about me being captured resting on my wall by Google. I checked what they say about protecting my privacy apart from blurring of my face (but its still pretty unmistakable – and quite Manatee like – and still not obscure enough to dampen the “OMG you look like a hobo in jogging gear” reaction of my kids).

Google claim (http://www.google.co.uk/help/maps/streetview/privacy.html):

“Street View contains imagery that is no different from what you might see driving or walking down the street.”

This statement intrigued me. Sure I can report a problem and presumably request they remove my image (respecting I guess my sort of property right to my image, but I haven’t tested it yet), but it is the “no different” bit of their claim that got me thinking.

What Google have captured with me on Steetview is a moment. A unique moment defined by its own space and time.  It is absolutely different to any other moment – there can never be another combination of time or space like that one (unless I find myself a Tardis).  Ever.

Every minute of every day we consume such moments and these can never be repeated. I may go for a run again, wear the same jogging pants and sit knackered on the same wall but it will be at a different time on a different day.

This to my mind implies that viewing moments in space and time are bit like consuming a private good.  The consumption of a true private good as we know is both rival and excludable. Does that characterise my moment?  To consume my moment you would have to walk down my street at the right time.  Any other place or time and you are excluded from enjoying my moment. So by virtue of time and space I can exclude you from consumption of this moment.  It is also kind of rival as well up to a point.  If you are walking down the street at the right time and happen to be with a friend you kind of consume the same view at the same time.  So that tends to suggest non-rival in nature.  But walk down the street with a thousand of your friends (I bet you are that popular) and I doubt you will all enjoy the same view at the same time.  So the rival aspect kicks in at some point (a bit like a system of water pipes).

But here’s the thing.  Google with the input of a car, some fuel and time, a camera, some people and some carbon thirsty servers located somewhere in sunny California (sorry they claim to be carbon neutral I think) have transformed my rival and excludable private moment into something that is a lot more non-rival and well nigh non-excludable (ok you need a computer and an internet connection).  Anyone can share that unique moment in time and space and given their server capacity lots of anyones can consume the same moment.  You don’t any longer have to occupy that precise time and space to capture or consume the moment.  The private has become public.

Up to this point like me you might be thinking so what?  It is human instinct to record things for posterity.  We have always captured moments – through oral traditions, the written word and lately through photos and video.  And without such recording many exceptional and revolutionary moments would have been lost to us all.  Google is just transforming through the clever use of modern technology those private moments and turning them into some kind of global commons of moments.  And think about the potential gain. How useful it would have been to have, as an example, the Google Streetview car touring the streets of Jerusalem about 2000 years ago.  All those unresolvable arguments finally resolved through the timely capture of a few private moments.

But therein lies the problem with Streetview. It may be a global commons of moments.  But it is a commons of pretty random and most likely dull moments (though I guess you might laugh at my moment on the wall).  And even Google can’t capture all in the universe of private moments and I bet they can’t predict when and where the good or worth capturing ones will pop up (like the colourful and noisy Sikh weddings that take place most summers down my street).

So I am left wondering if this particular commons is one we want to take care of and look after or even look at.  Only I suspect if you are burglar by trade and that is another problem I haven’t even touched upon.

The tragedy of this commons is not the threat of over-use, but really that it is far too ephemeral for most of us to care.  The economics lesson here is that if you want people to look after and care for a commons then you should let them own a bit of it.  The problem with Streetview is that by design none of us own it.  Without our consent Google in its increasingly classically inefficient command and control manner is capturing a set of private moments that is way inferior to the ones we might have willingly provided ourselves.  Google have strangely ignored what made its own YouTube and things like Facebook and Twitter so successful.  Those are also all collections of private moments (pictures, video, comments, thoughts) transformed into a global commons.  But they thrive because we choose the moments we want to share (and who can share them) and they are all the more valuable and worthy because of that simple but democratic reality.

I have decided I don’t mind Google having my moment on their Streetview. More fool them for recording that one.  If only they had asked they could have had a much better one and without the cost of all that carbon…

– Manatee

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Elsea and I attended a talk on Monday hosted by the Westminster Skeptics in the Pub, where Professor Brian Cox (of BBC’s Wonders of the Solar System fame) and Dr Evan Harris (Liberal Democrat and member of the science and technology committee) gave a talk on science policy in the coming general elections.

There was a lot of talk about something Brian Cox called the ‘impact agenda’, which basically covers the notion that funding for scientific research should be given on the basis of the ‘impact’ it will have on society, in other words the amount of ‘benefit’ that would ensue from the research.  Generally, in a big picture kind of way, I personally feel that this is a good thing, as this is an effort to ensure that science spending is targeted in a way that provides the most benefit to us.

However, and this is a point that Brian Cox stressed, it is very difficult to measure the full benefits of any particular science research before it happens.  Benefits can be very wide ranging and difficult to capture.

Many people felt (and still feel) that the US wasted a lot of money ($25 billion in the 1960s, worth about $100 billion today) sending men to the moon.  “How did it benefit us?” is a very valid question, one which Chase Econometric Associates attempted to answer in 1976.  They came up with a ratio of 14:1… that is that for every dollar spent on the Apollo mission, the US public received a benefit of $14.  By 1976, research from the moon mission had already benefitted the aereospace industry, computer industry, car industry and international communications industry, just to name a few.  I have no doubt that technological advances of today  still owe their existence to the Apollo mission (and we haven’t even covered the scientific research and technology that we currently have that were discovered and invented by little boys and girls who watched the moon landing and grew up wanting to be physicists or engineers, or the little boys and girls that they have inspired in turn).

I doubt people at the time could have predicted that the $25 billion they had spent sending men to the moon would bring so much benefit to those of us living in their future and similarly, it is very difficult for us to imagine the benefits that so-called ‘blue skies’ research can bring to people  in the future.

Scientists can and by all means should make an attempt to value the end products of research, to make themselves accountable to the public and show them what they are doing and the benefits they can expect to glean from it.  However, the value of the potential of blue skies research is much greater than what we can currently define and value; the blue skies research of the last three centuries has completely changed the human race’s way of living. While the benefits that can be identified now are limited by what we think is applicable today, the greater benefits of scientific research are likely to go beyond our current imagination.

As Brian Cox said, economic analysis of the benefits of scientific research is difficult, if not impossible. But economic analysis is never intended to be the only input decision-making but simply one of the inputs. Therefore, the impossibility of identifying all the likely benefits of research that has not yet carried out, and the difficulties of estimating the economic value of those that are identified should not hinder science funding. The intention is that valuing what benefits that can be identified helps make a supporting case for research.

Coming up next in Big Bang for your Buck – Part II:  Elsea explores how we can get the cow to jump over the moon without re-breaking the bank(s).

Explore further:

The Economic Impacts of the US Space Program

Petition decries ‘impact’ agenda in research

Westminster Skeptics in the Pub

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The Advertising Standards Agency have banned two Government advertisements on climate change.

What were the ads?

Using two nursery rhymes, the ads were attracting attention to the changes in the frequency and severity of extreme weather events and the people who are going to have to deal with them: today’s children.
















What provoked the ban?

939 complaints were made to the Agency last year about the entire campaign (which includes a television commercial and three other advertisements) apparently more than received against any other campaign.

The reason given?

The ASA has ruled that the claims made in the newspaper adverts were not supported by solid science and has told the Department of Energy and Climate Change (DECC) that they should not be published again.

I am furious about this decision and the hypocrisy of it.

  1. How is the ASA able to determine what is ‘solid’science and what is not? Apparently by comparing IPCC wording with that used in the advertisement. It’s an advertisement not a scientific paper!
  2. How could ASA insist on ‘solid’ (I presume that means ‘certain’) science when there is rarely such a thing, whichever field you look at? Indeed there is hardly anything certain in life (other than that in the words of Keynes ‘we will all be dead in the long run’) and we still carry on with what limited information we have! Why is this so different?
  3. And, perhaps the most sinister thing about ASA’s decision…why don’t they require the same ‘solid’ link behind advertisements that imply benefits for which there is absolutely no proof…like
  • “90 women who used our age-defying cream say it works” – well this is not exactly scientific research, is it?
  • Implied messages like “a ‘sexy’ car will make you a ‘sexier’ man and attract any woman you like” – hmmm it won’t!
  • And any other ad that intrudes our lives, tries to make us believe that whatever they are trying to sell will make our dreams come true.

Perhaps that’s the point. Anything is fine so long as they relate to dreams. But anything that will wake us to reality must be ‘solid’.

Oh please! Regardless of the level of certainty about the links between human induced emissions – global warming and its effects, the effects are experienced throughout the world. They may not be called Jack and Jill but there is an increasing number of children around the world who spend most their days looking for water and others who lose everything in floods and storms.  The reality that the Government is trying to point out is that the UK’s children are not immune from this and, should things not change, this could be their reality in the future.

Question marks about the science are not sufficiently ‘solid’ to stop us from facing these changes and doing our part.

PS. Perhaps the ASA should be thanked for giving the ads renewed publicity…no such thing as bad publicity and all that.

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Tomorrow, our herd will get together with others in the field in our annual gathering to share our work to date and ideas for the future. See the programme of the day (envecon) here: www.uknee.org.uk.

We bring together those who commission work and who undertake it so that there is better communication between the two – nothing like understanding the purpose of your work to produce the best results, right?

There will be many environmental economists in the gathering. But there will also be others from many other disciplines who work to protect / improve the environment. Most of the time we get along. Sometimes we find it difficult to communicate. I’ve been thinking about why and came up with some possible reasons. We are creatures of habit so:

  • We are more comfortable with the type of data that we are familiar with and sometimes suspicious of others,
  • We like creating terminology that makes what we do seem more complex than it really is, and
  • We sometimes suffer from arrogance that makes us think (obviously mistakenly) we know better than others.

We have to leave such bad habits behind if we want to become useful experts. We can make a difference (however small) only if we learn to understand each other’s data, converse in each other’s terminology (having mutually simplified it) and always remember that together we can produce much better results than we can on our own.

Last, but definitely not the least, we need to agree on our mutual purpose for wanting to collaborate. We want to collaborate not so that we can impose the world view of our respective disciplines on others but so that we can influence decisions made by politicians, policy makers, businesses and individuals for the benefit of the environment and the humanity. If we can agree on this fundamental purpose, we will find an inherent desire to develop our communication skills for better collaboration.

I also think that if we are motivated by a joint vision, breaking our old habits will not seem like a chore but a welcomed exercise that will make us all stronger. This is why I am looking forward to tomorrow’s gathering.

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This is the view from the highway as you travel from Kuala Lumpur International Airport into the city of Kuala Lumpur.

It is about 20km from the airport to the government city of Putrajaya, and everywhere you look is oil palm (This is not an exaggeration. For an overhead view, click here and zoom in).  For a tourist, these oil palm plantations are often one of the first views of Malaysia, even before landing in its modern airport of glass and steel, and one could be forgiven for imagining these palms to be natural growths and a native of Malaysia.  In fact Malaysia’s oil palm is a native of Guinea, Africa, and was introduced to the British colony of Malaya in 1910 by Scotsman William Sime and Englishman Henry Darby. Today, Sime Darby, the conglomerate product of this partnership, boasts of being the world’s largest plantations company, with a total of about 525,000 hectares of oil palm in Malaysia and Indonesia [1].

All in all, palm oil plantations in Malaysia made up 4.5 million hectares of land (13.7% of Malaysia’s land area of 33 million hectares [2]) and generated 15 million tonnes of palm oil in 2008 [3].  In January 2010 palm oil exports were the second largest export product from Malaysia and were worth around GBP £793 million or 8% of total exports from Malaysia in that month [4].

Palm oil obviously makes up an important part of the Malaysian economy, but at what cost?  The clearing of land for palm plantations was responsible for the loss of roughly 758,000 hectares of rainforest between 1990 and 2002, or 47% of oil palm plantations planted in that period [5].  Planning permission for palm oil plantations has mysteriously been given to convert thousands of hectares of forest previously classified as ‘permanent reserved forest’, including 6000 hectares of High Conservation Value forest; home to rhinos, tigers, honey bears, gibbons, tapirs, panthers, and ramin trees (an endangered tree species), and 3,899 hectares of forest in Terengganu State, a forest isolated from the main range and containing endemic species.  Terengganu may sound familiar as it is famous for its big mammals including tigers, elephants and our large cousins, seladang [5].

Seladang - Picture Courtesy of asianimages.wordpress.com

Surely, forests in their natural state as habitats to these and other species, and serving several ecosystem services, have economic values, even if not in cash terms. Estimating what this economic value can be is what we environmental economists do, amongst other things.

An example of such work is a study on the Leuser National Park in Sumatra, Indonesia (a very similar habitat to rainforest in Malaysia, due to its geographical proximity) which attempted to discover what we call the “total economic value” of the park for different uses of the land, including conservation and deforestation for agriculture.

Calculation of total economic value of the environment is based on individuals’ preferences for the environment and takes account of:

  • its direct use value such as the revenue from palm oil, but also as in the Leuser National Park example water supply, timber, non-timber forest resources and fisheries. Some of these uses are marketed like palm oil and timber, while others do not have markets,
  • its indirect use value from ecosystem services such as  flood and drought prevention, fire prevention, carbon sequestration. Most of these services are not traded in markets ,
  • option values for possible future use of the rainforest for medicinal cures or possible future tourism, and
  • values people may have for the environment even if they do not use it directly or indirectly (the so called ‘non-use’ value).

The Leuser National Park study found that if the park was converted to produce goods that are marketed, the accumulated Total Economic Value over 30 years would add up to US$ 7 billion. However, if the park was conserved in its natural state, the accumulated Total Economic Value over 30 years would be US$9.5 billion. This clearly shows that conservation has more value than conversion – and this is despite the fact that under the conservation scenario it is not possible to estimate many of the benefits in monetary terms [6].

On a purely economic basis, Malaysia could be losing a lot more than they are currently earning from palm oil.  The problem in reality is that even if we can have similar studies in Malaysia (and there are some), demonstrating the value of forest conservation is not enough, if marketed goods remain the only way to ‘capture’ the economic value of forests (or turn them into cash), incentive to conserve will be minimal.

Some policies are developed precisely to make conservation pay for itself. For example, REDD and REDD plus which allow for international payments for carbon sequestration and biodiversity protection, can facilitate this in the very near future [7].

A compromise between oil palm and standing forest can also be reached.  A study from the University of East Anglia showed that consumers are willing to pay more for palm oil from an environmentally sustainable plantation.  The combination of conservation and these premium prices could create a greater total economic value, including greater value for oil palm plantation owners [8].

Although this has been a very long post and I have in no way shape or form managed a complete coverage of all the factors, I should wrap up by saying that current attempts at creating sustainable oil palm plantations should be applauded.

Some of the oil palm industry in Malaysia is trying its best to be sustainable, with at least half of new oil palm plantations being planted on old plantation land between 1990 and 2002, and the largest companies being members of the Round Table on Sustainable Oil Palm.  If only Indonesia could follow in its footsteps!

[1] Sime Darby – Plantation

[2] Asia-Pacific in Figures 2006, UNESCAP

[3] Department of Statistics Malaysia – Production of Major Commodities

[4] Department of Statistics Malaysia – Preliminary Release of Malaysia External Trade Statistics January 2010 (Updated: 05/03/2010)

[5] Greasy Palms – The social and ecological impacts of large-scale oil palm plantation development in Southeast Asia

[6] Economic valuation of the Leuser National Park on Sumatra, Indonesia

[7] Koh, Lian Pin; Butler, Rhett A. Can REDD make natural forests competitive with oil palm?

[8] Bateman, I., Coombes, Emma, Fisher, B., Fitzherbert, Emily, Glew, David, Naidoo, Robin. (2009) Saving Sumatra’s species: Combining economics and ecology to define an efficient and self-sustaining program for inducing conservation within oil palm plantations

Bateman, I., Fisher, B., Fitzherbert, Emily, Glew, David William, Watkinson, Andrew. (2008) Making Tigers Pay: Marketing Conservation of the Sumatran Tiger Through ‘Tiger Friendly’ Oil Palm Production

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We contributed a moo to a very important herd (the Foresight Unit in the Government Office for Science no less) who were trying to think about the future of land use, and raise questions for Government to address. Lots of externalities and environmental issues to consider.

A dominant issue in UK land use planning in the last decade has been the ambition to build new dwellings in order to provide affordable housing, with high house prices being put down to the excess of demand in comparison to supply. This has always been an oversimplification of the market (it has highly localised price variations) and there is no national land use plan regulating the other factors involved. Rising numbers of households result in demand for more residential space. This would be true even if the population was not increasing. In fact, the main driver of rising household numbers is the reduction in average household size – which results in more demand for housing because households with fewer people have more residential space per person.

The Foresight report on land use planning considers the externalities of housing in relation to the environment in terms of building on previously undeveloped land, which is nice to see spelt out. But not all externalities are dealt with the same way. In some cases, like protecting green space, we are willing to deal with externalities through regulation. But where it seems like society is using space less efficiently, should we just predict this need and unquestioningly provide the space people demand? Or should we take into account the environmental externalities involved and try to manage it? In the housing market, is the shortage of space for some people more a reflection of the distribution of wealth in this country? Like I said, the purpose of the report is to pose questions to Government…

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