maandag 1 juli 2013

Mapping marine economics (6): Putting it all together

I promised myself not to write this post. I'm sure not everybody will agree with how I redefine some of the terms commonly used in economics, or perhaps more broadly in philosophy of science. But doing so gives me a framework that I find quite helpful to map a disciplinary field.

So here goes.

In this post I argued that economists working on a particular policy issue (climate change, health, overfishing) do four types of research, similar to the four types of questions a doctor asks when treating a patient:
  1. Assessment: how bad is the problem?
  2. Diagnosis: what causes the problem?
  3. Objective: what is the best possible improvement?
  4. Prescription: how can we realize the objectives?
It is common among economists to distinguish positive economics (what is happening?), also called descriptive economics, from normative economics (what should be happening?), which is also called prescriptive economics. But for some issues it's not so clear-cut whether they are positive/descriptive or normative/prescriptive. For example, take monetary valuation of ecosystem services. On one hand you could argue that such valuation is positive/descriptive because it merely describes people's preferences with respect to ecosystem services: the recommendation comes later. On the other hand, by putting a price tag on nature you do make a normative statement: this is more important than that. So you might as well call a valuation study a normative/prescriptive exercise. I think analysis of policy instruments has the same problem. You could label such research positive/descriptive (e.g. "ITQs are more likely to lead to discarding than restrictions on fishing effort"), but also normative/prescriptive (e.g. "if you're worried about discards, don't introduce ITQs"). I think it would be easier if you slightly redefine the terms (and this is where the hatemail probably starts):
  • Positive: analyzing without judging, e.g. "if you do x then y will happen"
  • Normative: making a judgement, e.g. "x is better than y"
  • Descriptive: considering the situation 'as is', e.g. "we have a problem"
  • Prescriptive: making recommendations, e.g. "you can solve the problem with y"
The nice thing about these definitions is that you can make a quadrant that neatly describes the Assessment, Diagnosis, Objective, and Prescription:

NormativePositive
Descriptive1. Assessment2. Diagnosis
Prescriptive3. Objective4. Prescription

I know the boundaries between these four quadrants are not perfectly clear-cut either. If you do cost-benefit analysis you may need to do some non-market valuation (Quadrant 1), but you will make recommendations on which policy alternatives are more desirable (Quadrant 3 - or is it 4?). You can only set objectives (Quadrant 3) properly if you know how to achieve them (Quadrant 4). That's why I prefer to call it a map, rather than a classification. And as such I find it a helpful model to understand how different strands in the literature fit together.

So here it is, my map of the economics of coastal and marine ecosystems, formulated in research questions:
NormativePositive
Descriptive
  • What is the economic value of a coral reef?
  • How much tourism value is being lost by jellyfish outbreaks?
  • What are people willing to pay for whale conservation?
  • How do social norms evolve in common pool resource management?
  • When will countries cooperate in international fisheries management?
  • How do fishers decide how much and when to fish?
Prescriptive
  • What is the optimal harvest rate in an uncertain fishery?
  • What is the optimal spatial allocation of shrimp farming and mangrove forest in a coastal zone?
  • What is the optimal management strategy of an invasive species?
  • How do ITQs perform in a mixed fishery?
  • How can we design effective PES schemes?
  • How will a ban on discards affect a fishery?

Or in research methods:
NormativePositive
Descriptive
  • Contingent Valuation
  • Travel Cost Method
  • Choice Experiments
  • Game Theory
  • Field experiments
  • Evolutionary models
Prescriptive
  • Optimal Control Theory
  • Numerical optimization models
  • Cost-benefit analysis
  • Applied fisheries models
  • Game Theory
  • CGE models

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