Estimation of the aggregate agricultural supply response in Zimbabwe: The ARDL approach to cointegration

This paper uses relatively recent time series techniques on data spanning over different pricing regimes to estimate the aggregate agricultural supply response to price and non-price factors in Zimbabwe. The ARDL approach to cointegration employed here gives consistent estimates of supply response in the presence of regressor endogeneity and also permits the estimation of distinct estimates of both long-run and short-run elasticities when variables are not integrated of the same order. The results confirm that agricultural prices in Zimbabwe are endogenous and the variables are not integrated of the same order hence use of the ARDL was worthwhile. The paper finds a long-run price elasticity of 0.18 confirming findings in the literature that aggregate agricultural supply response to price is inelastic. This result means that the agricultural price policy is rather a blunt instrument for effecting growth in aggregate agricultural supply. The provision of non-price incentives must play a key role in reviving the agricultural sector in Zimbabwe.Aggregate agricultural supply response, ARDL approach to cointegration

The valuation of biodiversity conservation by the South African Khomani San "bushmen" community

The restitution of land to the Khomani San "bushmen" and Mier "agricultural" communities in May 2002 marked a significant shift in conservation in the Kgalagadi area in South Africa. The Khomani San and Mier communities were awarded land inside and outside the Kgalagadi Transfrontier Park. Given that the Khomani San interact more with nature, biodiversity conservation will only benefit from the land restitution in this case if the Khomani San are good environmental stewards. Therefore, this paper uses the contingent valuation method to investigate the values assigned to biodiversity conserved under the various forms of land tenure arrangements by the Khomani San in the Kgalagadi area and compares them to similar valuations by the adjacent Mier community. The proposed conservation programme sought to plant as many native trees, shrubs and grasslands as required to reduce biodiversity loss by 10% in terms of the quantities of each of the selected major species of the area. Despite the fact that the conservation programme has both winners and losers when implemented under any of the three land tenure arrangements considered, the findings suggest that the Khomani San, whose attitudes towards modern conservation have not been evaluated until now, and the adjacent Mier community generally attach a significant economic value to biodiversity in their area. The net economic value for conserving biodiversity under the various forms of land tenure arrangements by the Khomani San ranged from R928 to R4 672 relative to the Mier community’s range of R25 600 to R64 000. However, for both communities, in order for all members of the local communities to support biodiversity conservation unconditionally, mechanisms for fair distribution of the associated costs and benefits should be put in place.biodiversity, contingent valuation, Khomani San, Kgalagadi, land restitution

Will availing credit incentives to Zimbabwean farmers trigger a maize output response?

This paper evaluates the impact of credit availability on communal and commercial sector maize output in Zimbabwe. This is important given the increased use of concessionary credit for agriculture as a policy strategy to increase agricultural output and food security, in response to the disruption caused by controversial land reform. The results show that communal sector maize output does not respond to credit availability. Neither does it respond to area under cultivation. Rainfall is the single most important driver of communal agriculture. The commercial sector responds to credit incentives albeit with a very low elasticity. Therefore, credit availability is a rather impotent device for enhancing maize output and, generally, agricultural output in Zimbabwe. Since most of the newly resettled farmers typically operate like communal farmers, both the land reform programme and concessionary credit for agriculture will not be likely to increase agricultural output. An urgent review of the beneficiaries of the controversial land reform programme is needed to ensure that only profit maximizing farmers will have their landownership confirmed, while unproductive farmers are replaced, if the agricultural sector is to help revive the Zimbabwean economy. Thus, commercialisation - rather than communalisation - of the agricultural sector is the appropriate strategy to trigger an increased agricultural output response.ARDL approach to cointegration, credit, maize output response, Zimbabwe

Modelling International Tourism Demand for Zimbabwe

This paper uses the autoregressive distributed lag (ARDL) approach to cointegration to estimate the coefficients of the determinants of international tourism demand for Zimbabwe for the period 1998 to 2005. The results show that taste formation, transport costs, changes in global income and certain specific events have a significant impact on international tourism demand. This implies that the improvement of international tourism infrastructure (in order to reduce travel costs and enhance the quality of services to tourists) so as to reinforce taste formation are important for attracting more international tourists to Zimbabwe. Furthermore, the authorities can potentially increase international tourism demand for the country by promoting pleasant events in the country.International tourism demand, ARDL, Zimbabwe

Enhancing consumers' voluntary use of small-scale wind turbines to generate own electricity in South Africa

This paper investigates whether South African households and small businesses can take advantage of the country’s substantial wind resources to produce their own power from small-scale wind turbines in a viable way. The viability of small-scale wind turbines is assessed by means of a financial analysis based on the internal rate of return method. The recently announced wind feed-in tariff will not affect the viability of consumer-based small-scale wind turbines considered in this paper since such turbines are used to displace electricity consumption from the grid rather than supplying electricity to the grid. Thus the benefits of such wind turbines’ output is valued at the grid power tariff which is saved rather than at the wind feed-in tariff rate as electricity arbitrage opportunities are non-existent because of the smallness of the turbines. The analysis found the turbines to be viable in only a few of the windiest locations in South Africa. As the competiveness of the turbines is seriously challenged by the relatively low coal-based electricity tariffs in South Africa the financial analysis also considers alternative scenarios where the turbines are supported by financial mechanisms, namely: a tariff subsidy; a capital subsidy and revenue from carbon credits. The analysis reveals that a tariff subsidy of about R1.45/kWh or capital subsidy of about R30,000/kW will be more effective in boosting the viability of consumer-based small-scale wind turbines in areas with winds of at least 5m/s. Thus, if the government’s goal is renewable energy expansion in the country, there is a need for subsidizing all producers of renewable energy including those who produce it for their own consumption as they equally contribute to that goal. A tariff subsidy is however likely to be met with both political and public resistance if it means that consumers have to cross-subsidize the tariff. Also, the significant funds required for capital subsidies might not be freely available. An alternative solution would be granting soft loans to potential wind turbine buyers. Ultimately, the removal of distortionary support to coal-based electricity generation will go a long way in enhancing the viability of small-scale wind turbines.small-scale wind turbines; microgeneration; renewable energy; wind energy; South Africa

Modelling Fugitive Natural Resources in the Context of Transfrontier Parks: Under what conditions will conservation be successful in Africa?

The conservation of fugitive natural resources across national boundaries poses significant challenges in Africa. This realisation has resulted in the creation of transfrontier parks. While transfrontier parks help de-fragment wildlife habitats, in the presence of governance heterogeneity the same arrangements create uncertainty as they allow a diverse range of park managers to make decisions about wildlife. This paper formulates a bioeconomic model to examine the determinants of successful conservation of migratory wildlife across a transfrontier park with patch heterogeneity. The examination shows three key results. Firstly, it is both ecologically and economically worthwhile to establish a unified transfrontier park rather than have disjointed national ones only if stronger governance institutions exist in higher-resource potential areas. Secondly, the local communities will cooperate with transfrontier conservation effort only if they derive greater benefit flows from transfrontier park-based wildlife conservation than from anti-conservation activities such as wildlife poaching. Thirdly, successful conservation requires transfrontier arrangements that equalise the long-run costs and benefits for all constituent partners. Given the presence of patch and governance heterogeneity, successful elephant conservation in Southern Africa requires that South Africa shares benefits with Mozambique and Zimbabwe despite their weaker institutions to prevent resource leakages from threatening the transfrontier park.

Can the restrictive harvest period policy conserve mopane worms in Southern Africa? A bio-economic modelling approach

Imbrasia Belina also known as the mopane worm, like other edible insects and caterpillars, is a vital source of protein to Southern African countries. The worms live and graze on mopane trees, which occupy agricultural land. With increasing commercialization of the worm, the management of the worm, which was hitherto organized as a common property resource, has degraded to a near open access. In this paper, a simple bio-economic modeling approach has been taken to show that, for some optimal land allocation, the restrictive period harvest season policy that is advocated by community leaders may not lead to sustainable harvesting of the worm.

Bioeconomic Model of Community Incentives for Wildlife Management Before and After CAMPFIRE

This paper formulates a bioeconomic model to analyze community incentives for wildlife management under benefit-sharing programs like the Communal Areas Management Programme for Indigenous Resources (CAMPFIRE) in Zimbabwe. Two agents influence the wildlife stock: a parks agency determines hunting quotas, and a local community chooses to either aid or discourage outside poachers. Wildlife generates revenues from hunting licenses and tourism; it also intrudes on local agriculture. We consider two benefit-sharing regimes: shares of wildlife tourism rents and shares of hunting licenses. Resource sharing does not necessarily improve community welfare or incentives for wildlife conservation. Results depend on the exact design of the benefit shares, the size of the benefits compared with agricultural losses, and the way in which the parks agency sets hunting licenses.bioeconomic, CAMPFIRE, community, poaching, wildlife, benefit sharing

Can local communities in Zimbabwe be trusted with wildlife management?: Evidence from contingent valuation of elephants

If local communities living adjacent to the elephant see it as a burden, then they cannot be trusted to be its stewards. To assess their valuation of it, a CVM study was conducted for one CAMPFIRE district in Zimbabwe. Respondents were classified according to their preferences over the elephant. The median WTP for the preservation of 200 elephants is ZW$260 (US$4.73) for respondents who considered the elephant a public good while the same statistic is ZW$137 (US$2.49) for those favouring its translocation. The preservation of 200 elephants yields an annual net worth of ZW$10,828 (US$196) to CAMPFIRE households. However, the majority of households (62%) do not support elephant preservation. This is one argument against devolution of elephant conservation to local communities. Adequate economic incentives must be extended to local communities if their majority is to partake in sound elephant conservation. External transfers constitute one way of providing additional economic incentives.Campfire, contingent valuation, double bounded spike model, elephant, Zimbabwe

Securing benefits for local communities from international visitors to the Kgalagadi Transfrontier Park

Abstract: This paper estimates the visitation demand function for Kgalagadi Transfrontier Park (KTP) in order to determine the scope for raising fees charged to international tourists in order to fund revenue-sharing schemes for local communities. International and Southern African Development Community tourists account for approximately 25% and 2% of the total number of visitors to South African national parks, with domestic visitors making up the remaining portion. Though small, the South African international tourism market is mature, and accounts for a disproportionately large share (around 42%) of net revenue. To estimate visitation demand at the KTP and three other national parks, random effects Tobit Model was used. Using the estimated elasticities, the revenue-maximising daily conservation fee was computed to be R1 131.94 (US$144.20) for KTP, which can be compared with the R180 (US$22.93) currently charged. Furthermore, the study also demonstrated that there is a possibility of raising fees at the other three parks. Sharing conservation revenue with communities surrounding parks could demonstrate the link between ecotourism and local communities’ economic development, and promote a positive view of land restitution involving national parks