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Demand and Supply of Nature Conservation

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Demand and Supply of Nature Conservation Faculty of Environmental Sciences Demand and Supply of Nature Conservation Dissertation for awarding the academic degree Doctor rerum silvaticarum (Dr. rer. silv.) Submitted by M. Sc. Carolin Werthschütz born on April 20th 1985 in Freital Reviewed by: Prof. Dr. habil. Peter Deegen, Technische Universität Dresden Prof. Dr. habil. Goddert von Oheimb, Technische Universität Dresden Prof. Dr. habil. Jan Schnellenbach, Brandenburg University of Technology Cottbus – Senftenberg Date of Submission: April 6th 2017; Tharandt Date of Defense: December 12th 2017; Tharandt Demand and Supply of Nature Conservation Declaration of Conformity Explanation of the doctoral candidate This is to certify that this copy is fully congruent with the original copy of the dissertation with the topic "Demand and Supply of Nature Conservation" Tharandt, April 6th 2017 Carolin Werthschütz II Demand and Supply of Nature Conservation Acknowledgement The success of scientific research – to generate new findings – depends on and is influenced by various external circumstances. I was in the lucky position to receive promoting support of different kind by many persons. I am highly grateful for the respectful and reliable supervision by Prof. Dr. habil. Peter Deegen. He gave me the necessary intellectual freedom to develop own thoughts. Many inspiring discussions and possibilities for an exchange of ideas accompanied our cooperation. During the last years I studied the economics of nature conservation, but the insights I have gained with the help of Peter Deegen go beyond the academic area. Scientific exchange is enriched when a research problem is discussed jointly by different academic disciplines. I would like to thank Prof. Dr. habil. Norbert Weber for the always benevolent discourse between economics and political science. In the final stage of this dissertation, I received additionally very helpful and constructive comments by Prof. Dr. habil. Goddert von Oheimb (Technische Universität Dresden) and Prof. Dr. habil. Jan Schnellenbach (Brandenburg University of Technology Cottbus–Senftenberg). Furthermore, they agreed to prepare a review of this study. Many thanks for this. For the encouraging and collegial atmosphere, I express my sincere gratitude to the colleagues of the Institute of Forest Economics and Forest Management Planning in Tharandt. Obviously, the writing of a dissertation is characterized by many ups and downs. To maintain the necessary motivation, persistence and optimism but as well to have a mental change to the academic thinking, I thank my whole family and my friends. For the financial and non–material support I owe my special thanks to the German Academic Scholarship Foundation. III Demand and Supply of Nature Conservation Table of Content List of Figures ............................................................................................................................................... VIII List of Tables ...................................................................................................................................................... X List of Abbreviations ..................................................................................................................................... XI Summary ........................................................................................................................................................ XIV 1 Introduction .............................................................................................................................................. 1 1.1 Heterogeneity in Nature Conservation ............................................................................................ 1 1.2 Economic Method for Examining Nature Conservation ............................................................ 2 1.2.1 Individual Preferences, Values and Costs ................................................................................... 2 1.2.2 Property Rights ...................................................................................................................................... 5 1.2.3 Interactions ............................................................................................................................................. 6 1.2.3.1 Individual and Collective Exchanges ........................................................................................ 6 1.2.3.2 Demand and Supply ........................................................................................................................ 7 1.3 Object of Study............................................................................................................................................ 8 1.3.1 Observed Failure to Meet Targets, Dissatisfaction and Implementation Deficits ...... 8 1.3.2 Observed Organization of Demand for Nature Conservation ............................................. 9 1.3.3 Observed Organization of Supply of Nature Conservation ............................................... 10 1.3.4 Observed Exchanges of Nature Conservation ........................................................................ 11 1.4 Aims and Research Question ............................................................................................................. 13 1.5 Differentiation to other Studies ........................................................................................................ 14 1.6 Structure of the Dissertation ............................................................................................................. 16 2 Model ........................................................................................................................................................ 17 2.1 The Individual Demand Curve D ...................................................................................................... 18 2.1.1 Costs of Nature Conservation cD .................................................................................................. 19 2.1.1.1 Strictness of Conservation Aims s .......................................................................................... 19 2.1.1.2 Size of the Bundle of Property Rights q ................................................................................ 20 2.1.1.3 Productivity a ................................................................................................................................. 21 2.1.1.4 Explanation of the Following Figures ................................................................................... 22 2.1.2 Individual Valuation of Nature Conservation vNC .................................................................. 23 2.1.3 Hypotheses for the Individual Demand for Nature Conservation ................................. 24 2.2 The Individual Supply Curve S .......................................................................................................... 25 2.2.1 Costs of Supplying Nature Conservation cS ............................................................................. 26 IV Demand and Supply of Nature Conservation 2.2.1.1 Determinants of the Costs of Supplying Nature Conservation cS .............................. 27 2.2.2 Individually Valuated Received Payments pS ......................................................................... 28 2.2.3 Hypotheses for the Individual Supply of Nature Conservation ...................................... 28 3 Analysis .................................................................................................................................................... 31 3.1 Organization of Demand and Supply of Nature Conservation ............................................. 31 3.1.1 Aggregation of Individual Choices .............................................................................................. 31 3.1.1.1 Political Exchange ......................................................................................................................... 32 3.1.1.2 Market Exchange ........................................................................................................................... 34 3.1.1.3 Organization of Demand for and Supply of Nature Conservation............................. 34 3.2 Institutions of Exchanging Nature Conservation ...................................................................... 35 3.2.1 Voluntary Exchange .......................................................................................................................... 35 3.2.2 Involuntary Exchange ...................................................................................................................... 36 3.2.2.1 Eminent Domain ............................................................................................................................ 37 3.2.2.2 Confiscation ..................................................................................................................................... 37 3.3 Institutional and Organizational Arrangements for Implementing Nature Conservation ............................................................................................................................................ 38 3.4 Voluntary Exchange of Property Rights for Nature Conservation ..................................... 39 3.4.1 Individual Demand and Individual Supply .............................................................................. 39 3.4.1.1 Subsistence Economy .................................................................................................................
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