28 Apr 2016

Understanding poachers to save African elephants

Psymon writes:*

In South Korea, Korean tigers, also known as Siberian tigers, are one of the classic national symbols. It is as old as a legend about Dangun’s founding of Dangun Choseon, the first country in Korean history that is known to have existed in 2,333 BC. However, the last time Korean tigers were spotted was in 1943. The cause was Japan’s ruthless overhunting during its colonial occupation of the Korean peninsula. From 1910 to 1942, official record of caught and killed tigers were 141, and the unofficial death is estimated at more than 500. Considering only 7,000 tigers are left in the wild today, that is a huge number. It feels like a part of my Korean spirit is gone, and I believe that we should prevent a repetition of this tragedy. Yet, something very similar is happening again in the world.

Similarly, African elephants have long been held sacred, as the wise chief who impartially settles disputes among the forest creatures in African fables. They once roamed across most of the continent from the northern Mediterranean coast to the southern tip. Numbering three to five million in the last century, the population is down to approximately 470,000. Approximately 100,000 elephants were killed annually in the 1980s because of hunting. Lately, the growing ivory demand in China increased illegal poaching of African elephants. The international trade in elephant ivory recorded the highest ivory seizures since 1989, when trading ivory became illegal. Some say at this rate, African elephants will disappear in less than 150 years. Chinese government, as a member nation of CITES (Convention on International Trade in Endangered Species of Wild Fauna and Flora) announced that the trade of ivory will be dealt with zero tolerance policy.

According to Tom Milliken, TRAFFIC’s Elephant and Rhino Programme Leader, the final destination for ivory shipments is primarily China. So we have demand in China, and supply in Africa. As mentioned earlier, Chinese government employed stubborn policy against the growing demand, and the punishment for illegal poaching in Africa is death sentence. But apparently, neither side is working very well. One of the main reason is the price incentive. In China, it went up from 157 USD per kilo in 2008 to 7,000 USD per kilo in 2011. However, it is not the price incentive that drives people to actually kill another elephant. In fact, the criminal organizations involved in brokerage are the main beneficiaries of the illegal trade. What poachers get for killing elephants is food and clothes for the family, means of subsistence. The decision making of hunting is not incentive-driven, but survival-driven. In other words, high demand in ivory raises the price high enough for crime syndicates to have incentives to tempt hunters to illegal poaching. That is what’s really going on in the illegal ivory trade.

The direction of laws and regulations are mainly following precautionary principle, which is to restrain illegal poaching and control the ivory supply. But, as we now understand killing elephants is based on survival motives, precautionary measures such as threat of life sentence against poachers seems redundant. One possible alternative direction that can offer a rational solution is the polluter-pays principle. In that case, there remain two possible suspects in the ivory trade market: the intermediary agent and the demand. The intermediary agent is crime organizations while most of the demand is the rising upper class, yet ordinary, Chinese citizens. It naturally gives an impression that crime organizations are the core of the problem. But I believe the rising upper class is the key to the solution. As long as there exist demand and profit opportunities, some kind of an intermediary or a broker will emerge whether it is a legal corporation or a criminal organization. Then the question is how to control the demand.

Martin Dufwenberg and Giancarlo Spagnolo’s (2015) article “Legalize Bribe Giving” is a good example that demonstrates how a legislation can correct behavior of individuals. Inspired by that article, I came up with a game theory model that would theoretically cease the illegal poaching. If we legalize Ivory trade market under strict government control and find a way to persuade the poachers not to fall into temptations of illegal poaching at the same time, the demand will fall into the shadow and there will no longer be profit opportunities. I believe carefully designed law using delicate game theory model can correct poachers’ decision making, preserve African elephants, and eventually help Mother Nature thrive.

Bottom Line Current legislations on illegal poaching and ivory trade are not carefully designed and do not take the circumstances that poachers face into consideration.

* Please comment on these posts from my environmental economics students, to help them with unclear analysis, alternative perspectives, better data, etc.