WEAI/AERE 2009 - Individual Paper Abstract
Title: Local Communities and Nature Based Tourism: Valuing Gray Whales in Coastal Communities of Baja (Mexico) Using a Two Phase Optimization Approach
Author(s): Duncan Knowler and Tobias Schwoerer, School of Resource and Environmental Management, Simon Fraser University, Burnaby, BC, V5A 1S6, Canada, djk@sfu.ca, (778)782-3421 (picture credit: student of Duncan Knowler)
Abstract: Nature-based tourism is often advocated as a desirable conservation strategy for developing countries, as it gives local people motivation to protect the wildlife and ecosystems that attract visitors, while benefiting the community. However, valuation of environmental inputs in nature-based tourism (e.g. charismatic species, scenic amenities, etc.) needs to be done correctly. Often, there are opportunity costs involved that are not counted, so that determining the value of the environmental inputs to local communities may be more complex than simpler calculations might indicate. For example, in communities where participants in a local whale watching industry also fish, they must decide if and when to switch from fishing to whale watching and in doing so must accept implicit tradeoffs. As a case study, we use gray whale watching in the small coastal communities of the Bahia Magdalena lagoon complex in Baja, Mexico. We model a wildlife species (whales) as an input to the production of wildlife viewing trips, but recognize that this occurs within a community dependent on a seasonal fishery. Standard theory suggests the industry will switch from fishing to whale watching each year when whale watching becomes marginally more profitable than fishing. We assume that both whale watching and fishing are managed by a social planner who is concerned with total community welfare, comprising income from both activities. We formulate distinct bioeconomic models for shrimp fishing and whale watching and then combine these two models within a dynamic optimization framework that maximizes community income. However, the two activities occur in sequence and the switching point is determined endogenously. In addition, both activities involve inputs that are subject to control. As a result, we employ a two phase switching optimization procedure. After presenting the optimization problem, we demonstrate the necessary conditions to solve it and derive the value of a marginal whale to the local communities.