Financing incentives for the protection of biodiversity

The conservation or sustainable use of biological diversity presents special challenges for policy-makers because of its complex nature and the difficulties associated with identifying the underlying causes that lead to biodiversity loss. As such, it is often necessary that a range of incentive measures are utilised to ensure both the private and the public benefits of its conservation or sustainable use are realised. Incentive measures available for this purpose include economic incentives (such as taxes, charges, tradable use rights, and subsidies), regulatory measures (such as development or access restrictions), and the provision of relevant information and sufficient institutional capacity. While many of the direct use values of biodiversity are privately appropriable given a clear assignment of property rights and the existence of markets, other financing methods are often necessary for the realisation of other values, such as indirect use values, non-use values and option values. This paper expands the analysis in the Handbook of Incentive Measures for Biodiversity: Design and Implementation (OECD, 1999) developed under the responsibility of the OECD Expert Group on Economic Aspects of Biodiversity to discuss some of the methods available for financing incentive measures for the conservation and sustainable use of biodiversity. Where appropriate, case studies of experiences in OECD countries are drawn upon to provide practical examples of the financing and implementation of incentive measures