Does trade help or hinder the conservation of natural resources?
Trade exerts important influences over the exploitation and protection of natural resources. Indeed, recognition of this influence is codified in the GATT, which allows exceptions to the treaty obligations for measures “relating to the conservation of exhaustible natural resources," motivates the Convention on International Trade in Endangered Species, and underlies the Convention on Biological Diversity. Trade impacts operate through several vectors. Trade liberalization changes relative prices, which affect exploitation incentives. Trade can also have broader equilibrium effects, such as on factor markets and incomes, which may affect demand for resource-intensive products—or for ecosystem services. Trade interacts with and can influence the institutions governing the management of natural resources. Finally, trade can also be a direct vector for introducing threats to ecosystems in the form of invasive species. All of these factors pose special challenges for the conservation of renewable resources, which inherently involves dynamic economic and ecological processes. This article takes stock of the lessons from the recent resource economics literature on trade and conservation.
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