Ecological Economics 33 2000 173 – 183
COMMENTARY
Economic considerations of privately owned parks
Jeffrey A. Langholz
a,
, James P. Lassoie
b
, David Lee
c
, Duane Chapman
c
a
Program in International En6ironmental Policy, Monterey Institute of International Studies, MIISIEP,
425
Van Buren St., Monterey, CA
93940
, USA
b
Department of Natural Resources, Cornell Uni6ersity, Ithaca, NY, USA
c
Department of Agricultural, Resource, and Managerial Economics, Cornell Uni6ersity, Ithaca, NY, USA Received 20 January 1999; received in revised form 8 July 1999; accepted 27 October 1999
Abstract
Privately owned parks continue to proliferate worldwide. Their rapid expansion represents an important yet little understood private sector incursion into an activity long dominated by governments. This paper examines economic
issues surrounding establishment and operation of privately owned natural areas. We interviewed owners of 68 private parks in Costa Rica to learn more about reserves’ underlying economics. Key findings include: 1 private
parks require an expanded definition of optimal reserve size — one in which quality of protection takes precedence over quantity of land protected; 2 profit was a powerful motivator behind private reserve operation, even though
many owners did not rely on their reserves for revenue generation; and 3 an important non-market value of private parks was the high bequest value owners placed on them. Last, we identify key information gaps that resource
economists can help fill regarding this increasingly popular conservation tool. The analysis contributes to our understanding of private reserves on both theoretical and empirical levels. It should be of interest wherever
biodiversity remains threatened, wherever new conservation partners are being sought, and wherever private reserves are being established, which includes most of the industrialized and developing world. © 2000 Elsevier Science B.V.
All rights reserved.
Keywords
:
Conservation; Ecotourism; Private parks; Protected areas; Stewardship www.elsevier.comlocateecolecon
1. Introduction
The alarming pace of habitat destruction neces- sitates development of innovative approaches for
in situ biodiversity conservation e.g. Western and Pearl, 1989; Wilson, 1989; McNeely et al., 1990.
Evidence suggests that current approaches to bio- diversity protection are more difficult and less
successful than was originally hoped Wells and Brandon, 1992; Kramer et al., 1997; Langholz,
1999b. Even worse, a shockingly high percentage
Corresponding author. E-mail address
:
jeff.langholzmiis.edu J.A. Langholz 0921-800900 - see front matter © 2000 Elsevier Science B.V. All rights reserved.
PII: S 0 9 2 1 - 8 0 0 9 9 9 0 0 1 4 1 - X
of parks are underprotected, with many existing on paper only Machlis and Tichnell, 1985;
Amend and Amend, 1992; Van Schaik et al., 1997; Brandon et al., 1998. Finally, even if public
parks were well protected, they still would leave more than 93 of the world’s land area unpro-
tected Western et al., 1993; World Resources Institute et al., 1998. It is clear we need to
explore new conservation strategies for protecting vast amounts of the land that will never be a
public park. As Western 1989 notes, ‘‘land be- yond parks is the best hope and biggest chal-
lenge’’ for conservation.
One option beyond public parks is the privately owned nature reserve. Private nature reserves
have been quietly proliferating throughout the world, yet little is known about them. Authors
have begun to mention their existence, but have provided little detail e.g. Adams, 1962; Zube and
Busch, 1990; Barborak, 1995; Murray, 1995; Bor- rini-Feyerabend, 1996; Langholz, 1996b; Schelhas
and Greenberg, 1996; Uphoff and Langholz, 1998. A few authors have done case studies high-
lighting various aspects of specific reserves e.g. Horwich, 1990; Glick and Orejuela, 1991; Echev-
erria et al., 1995; Alyward et al., 1996; Brandon, 1996; Wearing and Larsen, 1996; Yu et al., 1997.
On the international scale, three researchers have conducted mail surveys on private reserves, each
designed to confirm and build upon previous find- ings
Alderman, 1994;
Langholz, 1996a;
Mesquita, 1999. The 63 reserves in Alderman’s study, for example, were protecting more than
one million hectares of ecologically valuable habi- tat. Langholz 1999a has provided a proposed
category system for private reserves worldwide that captures their immense diversity. The typol-
ogy includes NGO-owned reserves such as those owned by The Nature Conservancy, as well as
nine other distinct types of private reserves. The study also sheds light on varying levels of ‘protec-
tion’ provided by reserves. Occupying one ex- treme, for example, were strict nature reserves
where all forms of human disturbance were pro- hibited. Such reserves typically enjoyed legal
recognition as wildnerness areas and corre- sponded to IUCN Category IA and IB protected
areas. On the other extreme were areas devoted primarily to human activity such as extraction of
food, fiber, and fuel. The largest group of private reserves, however, existed between the two ex-
tremes, pursuing biodiversity objectives in con- junction with relatively non-consumptive human
activity such as ecotourism IUCN Category IV.
Additional studies have confirmed the private sector’s increasingly important role in biodiversity
conservation Edwards, 1995; Merrifield, 1996. Even
the World
Conservation Union
has launched projects to learn more about this rela-
tively new conservation tool. In effect, what Dixon and Sherman 1990 called ‘‘...a small but
important development in protected area manage- ment’’ a few short years ago has evolved into a
major new direction in conservation.
Despite the sudden proliferation of private re- serves, and studies of them, we still know very
little. Most articles mention them only briefly. Worse, we know practically nothing of their un-
derlying economics. Granted, economists have an- alyzed private provision of various goods and
services, including prisons, police protection, garbage collection, schools, and so on e.g. Shi-
chor, 1995; Schmidt, 1996; Vickers and Yarrow, 1988, and they have recently started making con-
tributions to the protected areas literature in gen- eral e.g. Dixon and Sherman, 1990; Pearce and
Moran, 1994; Barbier et al., 1995. Economists have yet, however, to contribute to the emerging
private parks phenomenon. Given limited public resources available for conservation, and growing
interest in private sector initiatives, it is impera- tive that we begin to explore key economic issues
surrounding privately owned protected areas.
This study begins that process. It examines economic issues surrounding private nature re-
serves in Costa Rica. We begin by examining the theoretical underpinnings of privately owned
parks, emphasizing how landowners determine the amount of land to protect, and the key market
and non-market values they derive from such protection. We then provide empirical informa-
tion on key topics emerging from the theory. Specific topics include landowner perceptions of
optimal reserve size, market values such as reserve profitability, and non-market values such as be-
quest value.
Our overall intent is to provide much needed information and perspective on this important
new conservation trend in terms of both theory and practice. Hopefully, the discussion will also
entice other researchers to focus attention on private parks, leading to additional and deeper
economic
analyses. Finally,
the information
should be useful wherever biodiversity remains threatened, wherever conservationists are looking
for new partners, and wherever private reserves are being established, which includes most of the
industrialized and developing world.
2. Theoretical framework
