Tuesday, November 13, 2007

Book Review

Environment and the poor

Analysis of whether social, economic and gender inequalities aggravate environmental degradation

INEQUALITY, COOPERATION AND ENVIRONMENTAL SUSTAINABILITY: Jean-Marie Baland, Pranab Bardhan and Samuel Bowles — Editors; Oxford University Press, YMCA Library Building, Jai Singh Road, New Delhi-110001. Rs. 750

Samuel Bowles is co-author of the best textbook on economics (Understanding Capitalism) I have read in nearly 40 years as a student of the subject. I find Bowles’ recent work on cultural evolution and his use of “strong reciprocity” as a schema for predicting and understanding altruism in humans, nothing short of inspirational. Bowles is one of those who were asked by Martin Luther King Jr. to write background papers for the 1968 Poor People’s March. Pranab Bardhan is the world’s leading iconoclast on globalisation, punching holes in the certitudes of both Left and Right on its impact. Bardhan and Bowles head a research network on the Effects of Inequality on Economic Performance. The volume under review originated as a project of this network.

Economic inequality

Does inequality aggravate environmental degradation? The book tries to answer this question in the context of local commons, essential to the livelihoods of the poorest people in the world. Does inequality make cooperation to protect the commons more difficult? Do the poor damage the commons in pursuing their own interests? The book is a collection of broadly two kinds of papers that try to grapple with these conundrums — some present theoretical approaches such as agent-based computational models, while others provide results of empirical studies from commons across the world, covering forest areas in Nepal and India, irrigation farming in South India and Mexico, as also fisheries in the U.S. and Senegal.

One of the most fascinating papers in the volume is by Juan-Camilo Cardenas who follows Bowles’ example of moving common-pool resource experiments out of the ivory towers of university students to actual users of forests surrounding three Colombian villages. Cardenas finds that inequality does impede collective action by creating social distance, the negative impact being greater for those with lower wealth levels. Why communication engenders greater cooperation in social dilemmas is because it helps forge group identities, reinforces group goals and their benefits, and creates non-monetary social costs for free-riders. But wealth distances the possibilities of building trust. Poverty by itself does not limit cooperation though. Indeed, poorer but homogenous groups seem willing to cooperate to increase collectively generated individual benefits.

Environmental issues

Unsurprisingly, the most hard-hitting piece in this otherwise even-handed kind of book, is by James Boyce, who has for years been striving to sensitise mainstream economics on environmental issues. As Boyce says, “The global environment is our common home, but not everyone lives in the same room.” Boyce’s work reveals a shocking bias in hazardous waste disposal policy in the U.S. against low-income areas with high percentage of African Americans and other minority groups. Boyce argues that wider social and economic inequalities — based on class, race, ethnicity, gender, and age — lead to weaker environmental policies, which in turn result in greater environmental degradation. This suggests that inequalities in the distribution of power operate not only to the detriment of specific groups, but also to the detriment of environmental quality as a whole.

The book also includes a high-quality paper by Bina Agarwal on how gender inequality impinges on prospects of cooperation and environmental sustainability. For this she draws on her fieldwork in community forestry sites in five Indian states in the late 1990s. Agarwal finds that women bear disproportionately higher costs and obtain lower benefits from forest closure than men. Both pre-existing gender inequalities and those that spring up when new institutions are created, reduce the inclination and incentive for women to participate in forest protection. Inequalities across gender in economic endowments, gendered social norms and perceptions and the coercion women suffer in gender relations at home and in the community, all combine to constrain women’s participation.

Land inequality

In their study of 48 villages spread over six districts in Tamil Nadu, Bardhan and Dayton-Johnson find that greater land inequality is associated with poorer maintenance of tanks/canals and higher incidence of water-related conflicts. This is confirmed by their comparative study of central Mexico. Their findings also underscore the importance of local rules for maintaining irrigation resources and infrastructure. It is clear that maintenance suffers in systems where a substantial proportion of farmers believe that rules were crafted by the local elite. Conflicts are lower where there is caste or ejido homogeneity. What David Sally has termed “sympathy” (an inverse function of physical and psychological distance between people) is crucial. This clearly poses a serious challenge to conventional economic modelling that is still a great “distance” away, it appears, from the reality it is trying to understand!

For a book with so much insight and good guidance (as reflected in the quality of its editors), it is hard to comprehend how it can possibly include such shoddy empirical work as by Somanathan et al. in the Indian Himalayas and Baland et al. in Nepal. The Himalaya study suffers from an almost complete absence of ethnographic fieldwork, without which we get virtually no feel of the many social processes vital to an understanding of forest protection.

The Nepal study is even worse with its very poor quality data and again the lack of even an attempt to understand socio-historical and institutional dynamics. It is studies like these (and they sadly abound) that give econometrics a bad name. There appears a preoccupation (one could call it a vocation actually) with using (largely linear) regression models to answer questions (of the type “does x impact y?”) in a simple “yes, no, can’t say” sort of way, without any engagement with the far more interesting and insight-pregnant processes that govern these apparent “correlations”. Indeed, as Samuel Bowles himself has said in another context, the economic theory of cooperation and general equilibrium theory, both favouring parsimony over realism, suffer from a curious lack of attention to dynamics and out-of-equilibrium behaviour. Unfortunately, some of the papers in the volume he has co-edited cannot be said to be entirely free of these faults.

(Courtesy: The Hindu)

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