Banning the use of animal skins in the fashion industry sounds straightforward and may seem commendable – wild reptiles will be left in peace, instead of being killed for the luxury leather trade.
But decades of research show that by walking away from the commercial trade in reptile skins, Selfridges may well achieve the opposite to what it intends. Curtailing commercial trade will be a disaster for some wild populations of reptiles.
How can that be true? Surely commercial harvesting is a threat to the tropical reptiles that are collected and killed for their skins?
Actually, no. You have to look past the fate of the individual animal and consider the future of the species. Commercial harvesting gives local people – often very poor people – a direct financial incentive to conserve reptile populations and the habitats upon which they depend.As Natusch et al. note, if people can earn income from harvesting and selling crocodiles (or crocodile eggs), then there is an incentive to keep crocodiles around. The most straightforward example of this is farming. People are allocated private property rights over crocodiles (they own them in the general sense), and that creates an incentive for each farmer to sustainably manage their crocodiles.
However, in their article Natusch et al. are essentially arguing that the incentives are the same if you are thinking about maintaining wild populations of crocodiles. That is, if people can harvest from the population of wild crocodiles, then there is an incentive for people to maintain the population. However, while the authors appeal to previous research that supports their argument, they ignore an equally large literature on the Tragedy of the Commons. A population of wild crocodiles is a common resource - it is rival and non-excludable. Rival goods are those where one person's use of the good reduces the amount available to everyone else, i.e. in this case killing one crocodile reduces the number of crocodiles available to everyone. Non-excludable goods are those where you cannot easily prevent a person from obtaining the benefit from them, i.e. in this case it would be difficult to stop people from killing crocodiles.
The Tragedy of the Commons arises because the private incentive (to harvest as many crocodiles as you can, in order to maximise the income for your family) is not aligned with the social incentive (to keep the population sustainable). It leads to over-harvesting, and threatens the crocodile population.
Farming solves this problem by assigning property rights - it makes crocodiles a private good - rival but excludable (because only the crocodile farmers can kill them). However, what Natusch et al. are suggesting would not work without some other controls in place.
As the Nobel Prize winner Elinor Ostrom noted, the problem with common resources arises when they are open access - when everyone can access them freely with no restrictions. Private property rights are one way to restrict access, but not the only way. Another way to manage a population of wild crocodiles would be to issue harvest permits, with only permit holders allowed to kill crocodiles. This would make crocodiles closed access, and is similar to how we manage fisheries with the Transferable Quota system. This essentially creates a property right - the right to kill crocodiles.
Provided only a few permits are issued, the permit holders would have an incentive not to take too many crocodiles, because that would limit their future livelihoods. The more permit holders there are, the more the solution starts to dissolve into the open access Tragedy of the Commons, so limiting their numbers is necessary for sustainability.
So, as Natusch et al. argue, prohibiting the killing of crocodiles is not a good way to save them. However, incentives alone are not the solution. Some form of property rights needs to be created to ensure the long-term sustainability of the crocodile population.
