Research Evaluation, volume 14, number 3, December 2005, pages 000–000, Beech Tree Publishing, 10 Watford Close, Guildford,
Surrey GU1 2EP, England
Economic surplus analysis
Ex ante impact assessment for research on
natural resources management: methods and
application to aquatic resource systems
Roehlano Briones, Madan Dey, Ilona Stobutzki and Mark Prein
Under a particular representation of the impact
pathway of natural resource management (NRM)
research, economic surplus techniques can also
be used for ex ante impact assessment. The
method is applied to the case of the WorldFish
Center, an international organization specializing
in research on aquatic resources in developing
countries. A survey of expert opinion is used to
estimate productivity improvements and adoption
rates for NRM research and its application. A
supply–demand model for aquatic commodities is
constructed to calculate the resulting change in
economic surplus. Results indicate that ex ante
economic impact is highest for NRM on coral
reefs and inland aquatic systems.
Roehlano Briones was a postdoctoral fellow at the WorldFish
Center, Jalan Batu Maung, Batu Maung, 11960 Bayan Lepas,
Penang, Malaysia, at the time this study was conducted. Madan
Dey, Ilona Stobutzki and Mark Prein are WorldFish Center sci-
entists. Address correspondence to: Roehlano Briones, E-mail:
roehlbriones@yahoo.com
Research Evaluation December 2005 0958-2029/05/030000-00 US$08.00  Beech Tree Publishing 2005
E
CONOMIC TECHNIQUES FOR ex ante im-
pact assessment are accepted tools for evalu-
ating agricultural research. The need to
identify high-impact activities is keenly felt in the
public and nonprofit sector of developing countries,
where funds for research are seriously constrained.
Among these analytical techniques, the economic
surplus method is the most popular and arguably the
most fruitful approach for impact assessment
(Alston et al, 1995).
Applications of economic surplus analysis are
widespread in the case of farm commodity research.
Recently, with growing emphasis on sustainable de-
velopment, natural resources management (NRM)
has become a major category for agricultural re-
search. Unfortunately, NRM research has so far re-
sisted economic surplus analysis and other
conventional techniques of impact assessment,
whether ex post or ex ante (Izac, 1998; Pachico,
1998; Maredia et al, 2000; CGIAR, 2000; Pingali,
2001).
The differences in evaluation performance may be
traced to the nature of the impact pathways. For
farm commodity research the impact pathway is
straightforward. As impact depends on conditions in
parceled, artificial systems (farms), and the decen-
tralized choices of many individual farmers, the law
of large numbers permits a reasonable approxima-
tion of productivity impacts and adoption decisions
over time. However, for NRM, the impact pathway
is much more complex. Impact depends on condi-
tions in large-scale systems, for which the effects of
human activity are poorly understood. Moreover,
1
Natural resources management
adoption of research recommendations depends on
policy choices, set by the state under the influence of
socio-cultural and political factors. Predicting re-
search influence and the impact of research is a dif-
ficult and highly uncertain affair.
In practice, NRM research is evaluated or priori-
tized based on direct subjective approaches, such as
scoring (Kelly et al, 1995; Randolph et al, 2001).
While subjective approaches have their place, it is
desirable to integrate NRM into the wider ambit of
economic analysis. Reducing impacts on production
and consumption to a common metric of economic
value makes the choice issue more transparent. Fur-
thermore, the evaluation exercise can avail of a wide
body of evaluation techniques that extend conven-
tional economic surplus analysis, such as incorporat-
ing modifiers for uncertainty, non-market economic
values, and the like.
The main contribution of this study is to demon-
strate that economic surplus analysis can be used for
ex ante evaluation of NRM research. The critical
ingredient is an articulation of the impact pathway
for NRM research, which exploits an analogy from
the impact pathway for farm commodity research.
The pathway suggests a procedure for eliciting ex-
pert opinion regarding the likely supply shifts result-
ing from research and application. These shifts are
incorporated into a supply–demand model, which
computes the welfare impact (a generalized version
of the economic surplus measure). Combined with
an estimate of the required R&D investments, one
can then calculate benefit–cost ratios as an indicator
of ex ante economic impact.
The method is applied to impact assessment for
the WorldFish Center, an international organization
for research on aquatic resources in developing
countries, and a member of the Consultative Group
on International Agricultural Research (CGIAR).
Results are presented and some implications for re-
search and for research planning are discussed.
Framework
Impact pathways
Impact pathway analysis identifies causal links by
which research achieves its intended benefits.
Elaborating these links compels researchers to iden-
tify key stages from research to impact, the ex-
pected effects at each juncture, the indicators for
measurement, and the processes securing the links
(Springer-Heinze et al, 2003). In the following an
impact pathway analysis is presented for farm
commodity and NRM research.
The two categories of research are distinguished
mainly by the type of resource system being studied.
Farm commodities are produced in divisible sys-
tems, for example, farms or ponds, for which rights
to use are defined and enforced at an individual
level. Accordingly, allocation choices of individual
2 Research Evaluation December 2005
Impact assessment for farm
commodity research entails an
estimate of potential on-farm benefit,
measured by some indicator, for
example, higher yields (consistent with
lower per unit costs)
farmers are largely independent. However, natural
resource systems are common pool resources for
which subdivision into individual parcels is infeasi-
ble or uneconomical. Common examples are wild
fish stocks and many upland forests. Harvesting de-
cisions are therefore interdependent; however, this
interdependence is ignored by individual harvesters,
leading to resource degradation (Ostrom et al, 1994).
NRM aims to regulate extraction to maintain the
sustainability of harvesting activities.1
For farm commodity research, the impact path-
way is relatively straightforward: research generates
a specific innovation, such as a germplasm, a new
form of input, a new farm practice, and so on. The
innovation is then adopted by farmers (which may
be accompanied by local modifications by adopters;
these modification may themselves be the subject of
further R&D.) Benefit from adoption most often
takes the form of improved long-term productivity.2
(Other types of benefits include higher price, due to
better product quality, or reduced variability of
yield.) The process of adoption is a combination of
natural diffusion, as farmers copy one another or
share information, and deliberate dissemination
through the extension and farm support system.
Impact assessment for farm commodity research
therefore entails an estimate of potential on-farm
benefit, measured by some indicator, for example,
higher yields (consistent with lower per unit costs).
This is followed by an estimate of the following:
• The adoption process over a particular extrapola-
tion domain;
• The average on-farm benefit upon adoption, that
is, with an adjustment for yield gap, which is the
shortfall between average yield and yield under
best practice (Dey et al, 2000).
For economic surplus analysis, these estimates are
used to calculate supply shifts; simulation analysis
using a supply–demand model then calculates gross
benefits from the research–application continuum.
Given a reasonable estimate of the required invest-
ment in research and application, one can then calcu-
late the net economic impact of farm commodity
research.
Meanwhile for NRM research, the pathway to
 Natural resources management

impact takes the route of resource management. A
major constraint to resource management is the lack
of reliable information. Often the status of a particu-
lar natural stock or ecosystem is uncertain. Further-
more, the causal relations may also be vague or
weakly established, whether in terms of the impact
of human activity, or the likely outcomes of various
management options. Finally, the long-term eco-
nomic importance of maintaining resource sustain-
ability may also be poorly understood, undermining
the argument for immediate and decisive action, par-
ticularly when protecting the resource may imply
serious economic dislocation. Both biological and
social science research play a vital role in manage-
ment support, by assessing the status and values of
the resources, and by identifying the likely impacts
of human activity, management actions, and institu-
tional arrangements.
The simplified impact pathway for both farm
commodity and NRM research is drawn in Figure 1.
Farm commodity research generates technologies
and recommendations for farmers; farmers adopt
recommendations and increase the farm productiv-
ity. Similarly, NRM research produces recommenda-
tions, or an evaluation of management options; this
improves the quality of NRM decisions, which leads
to an increase in resource productivity. In both
cases, the results of applying research become feed-
back for later iterations of the research cycle (signi-
fied by the upward arrow in Figure 1).
Based on this pathway analogy, two measures
need to be estimated for NRM research: first is the
potential yield improvement under a best-practice
scenario (that is, proper or ideal application of NRM
research); second is the extent to which ideal appli-
cation of NRM research is adopted over time. In this
study, management performance is subsumed within
the estimate of adoption. For example, if the adop-
tion of NRM research is 80%, but quality of research
application is only 50% of the ideal (notionally
speaking), then the adoption figure is adjusted down
to 40%. This technique automatically incorporates
the ‘management performance gap’, an indicator that
parallels the ‘yield gap’ in the adoption of farm
commodity research.
Indicators and quantification procedure
The column at the right-hand side of Figure 1 sug-
gests indicators, at critical stages in the pathway, to

Research

Potential production gain per

Technology unit
recommendation
evaluation

Production gain per unit

Dissemination- Adoption rate (A10,Amax)
adoption
R&D cost
Improved management

Increase in supply

Change in economic surplus

Market Net economic benefit

Impact

Figure 1. Simplified impact pathway for farm commodity and NRM research
Note: Expert judgment is applied to estimate production gain per unit and to
calibrate the parameters of the adoption function (stated in text as
adoption ceiling and adoption in ten years). R&D cost is estimated by out-
put value shares based on literature review. Change in economic surplus
is evaluated using a supply–demand model; this benefit, net of cost, yields
the net economic benefit.

Research Evaluation December 2005 3

Natural resources management
be used for ex ante impact assessment. Given the
paucity of ex post impact assessment for NRM, es-
timation of these indicators relies on expert judg-
ment. Suppose one has defined a particular resource
system for which NRM research impact is to be
evaluated, and has obtained benchmark production
data for that system. Two scenarios may be consid-
ered: a ‘business-as-usual’ scenario for harvesting
behavior and NRM performance, and a ‘best-
practice’ scenario for research and applications on
NRM.
Resource experts (preferably practicing biolo-
gists) are asked to estimate production under these
two scenarios, relative to the benchmark production.
The difference in production between the two sce-
narios is the potential productivity gain from NRM
research.
The remaining indicator to be estimated is the
adoption of the best-practice scenario. In farm com-
modity research, adoption dynamics are often mod-
eled on the sigmoid curve (Alston et al, 1995). A
similar logistic process is assumed to hold for
NRM research. Let A denote the extent of adoption,
here measured as the percentage of output pro-
duced under the best-practice application of NRM
research. Let Amax denote the maximum extent of
adoption, or the adoption ceiling. The logistic
model assumes:
A& æA - A ö÷
= r ççç max ÷
÷ (1)
A è Amax ÷
ø • ‘Coral reefs’ — continental and island shelves in
where r is a constant. That is, the growth of the ex-
tent of adoption is a constant multiplied by the pro-
portional difference between the ceiling and current
adoption. Here time may be measured in years, with
the beginning year of the evaluation set at zero. De-
note adoption at time zero as A0, and let k = r Amax .
Then the time path of A is described by the follow-
ing equation:
Amax A0
A(t ) = (2)
A0 + ( Amax - A0 )e- kt
Once Amax has been estimated, the remaining prob-
lem is to parametrize k (or alternatively, r). Sup-
pose an estimate of adoption rate in year 10 is
available. Arbitrarily setting A0 = 0.005 (one-half
of one percent), the parameter k can be calibrated
as follows:
é( A - A(10)) A0 ù
k = - 0.1 *ln ê max ú (3)
êA(10)( Amax - A0 ) ú
ë û
where ln denotes the natural logarithm. Estimates of
ceiling adoption and adoption in year 10 can be elic-
ited from policy experts and socio-economists in the
field of NRM research.3
4 Research Evaluation December 2005
International research on aquatic NRM
The WorldFish Center
The WorldFish Center is one of 16 Future Harvest
Centers of the CGIAR. Its mission is to reduce pov-
erty and hunger by improving fisheries and aquacul-
ture. To guide WorldFish in its research planning,
the foregoing framework is applied to NRM research
for aquatic resources in the developing world. The
units of assessment are the major categories of
aquatic resource systems; these resource systems are
further disaggregated into the major regions of the
poorer areas of the developing world. The definition
of units follows the WorldFish Strategic Plan
(ICLARM, 1992). For aquatic resource systems the
categories are:
• ‘Lakes’ — including reservoirs, are mainly
freshwater bodies, whether natural or artificial,
used for irrigation, power generation, and house-
hold water supply.
• ‘Rivers’ — includes streams and floodplains;
streams and rivers are flowing waters, while
floodplains are low-lying areas adjacent to water-
courses, subject to periodic or near-permanent in-
undation.
• ‘Coasts’ — includes estuaries and lagoons, and
critical habitats, such as mangroves. Coastal wa-
ters (10 m deep or lower) encompass most fishing
grounds of small-scale fishers.
tropical oceans, in which reef-building corals are
dominant features.
In this study, the developing world is limited to Asia
and Africa, which hosts the bulk of the world’s poor
and undernourished. The regional divisions are:
• East Asia (EA)
• South Asia (SA)
• Southeast Asia (SEA)–Island (Indonesia, Malay-
sia, and the Philippines);
• SEA–Mainland (the Mekong countries, including
Burma);
• West Asia and North Africa (WANA);
• Sub-Saharan Africa (SSA).
The countries under each region are listed in Table 1.
There are 24 region-resource system combinations
(= four resource systems × six regions), comprising
the units of assessment. Data for the resource sys-
tems and regions is partly available from the FAO
fisheries statistical databases on capture production.
Eliciting expert opinion
The base year is set at 2001, the most recent year
available during the period of the study. Three ques-
tionnaires were formulated, one each for coast,
inland waters, and coral reefs. Subdivision between
 Natural resources management

Table 1. Country groupings by region of analysis Table 3. Average annual production growth for inland
capture, by region

East Asia Sub-Saharan Africa (cont.)

China Namibia Production, Average annual growth (%)
Korea, Democratic Republic Niger 1999–2001
Mongolia Nigeria (average 1991–1995 1996–2001
South Asia Rwanda annual, in mt)
Bangladesh Reunion
Bhutan Senegal East Asia 2,243,197 12.6 7.4
India Sierra Leone
Nepal Somalia South Asia 1,960,877 3.0 6.7
Pakistan Sudan Southeast Asia – 461,219 –0.4 –2.6
Sri Lanka Swaziland Island
Southeast Asia – Island Tanzania
Indonesia Togo Southeast Asia – 684,205 2.4 12.4
Malaysia Uganda Mainland
Philippines Western Sahara Sub-Saharan 5,325,738 0.7 1.7
Southeast Asia – Mainland Zambia Africa
Cambodia Zimbabwe
Laos West Asia and North Africa West Asia and 1,303,894 7.4 2.6
Myanmar Algeria North Africa
Thailand Bahrain World 8,665,072 3.9 4.4
Vietnam Egypt
Sub-Saharan Africa Iran Source: FAO (2003)
Angola Iraq
Benin Jordan
Botswana Kuwait
Burkina Faso Lebanon
to 5% above the benchmark, 5% to 10% above the
Burundi Libya benchmark, etc. There are three time horizons: the
Cameroon Morocco short term (years 1 to 5), the medium term (years 6
Central African Republic Qatar to 10), and the long term (years 11 to 20). The re-
Chad Saudi Arabia
Congo, Dem. Rep. Syrian spondents are requested to select their best guess
Congo, Rep. Tunisia about the appropriate interval, for each time horizon,
Côte d'Ivoire United Arab Emirates and for each scenario (business-as-usual and best-
Djibouti Yemen
Equatorial Guinea Oman practice). The production estimates are then appor-
Eritrea Turkey tioned to the regions of analysis using the ratios
found in the benchmark data. Once the average es-
timate is computed for the four fish types, a simple
average of these estimates is applied for the fish
lakes and rivers is omitted in the questionnaires ow- types not elsewhere classified.
ing to absence of benchmark data. The Coasts Ques- The questionnaire for inland waters is formulated
tionnaire is subdivided into the FAO ocean areas. in a similar manner as for coasts, though estimates
For each ocean area, respondents are shown annual are elicited for only one fish type (inland freshwater
benchmark production figures, averaged over the fish). Benchmark production figures (as well as re-
period 1999 to 2001 (Table 2). gional growth rates) are shown in Table 3.
Production is divided into the four major fish The Coral Reefs Questionnaire takes a more
types (demersal fish, pelagic fish, crustaceans, and roundabout approach. First, a literature search was
mollusks). Respondents are presented with percent- conducted to find a regionally available indicator for
age intervals above and below the benchmark figure, the state of coral reefs worldwide. The search yielded
for example, 5% to 10% below the benchmark, 0% the risk category presented in the Reefs at Risk study

Table 2. Average annual production by FAO ocean area and major fish type, in mt (average for 1999–2001)

Ocean area Demersal Pelagic Crustacean Mollusk

East Central Atlantic 447,254 2,583,125 71,779 236,104

Southeast Atlantic 429,938 1,079,737 18,841 8,899
Southwest Atlantic 907,491 165,772 107,416 1,047,849
West Central Atlantic 186,230 861,797 279,138 257,098
East Indian Ocean 757,659 1,402,512 345,308 320,217
West Indian Ocean 1,123,655 1,751,436 341,446 130,634
Mediterranean and Black Sea 279,347 933,532 48,671 162,601
East Central Pacific 100,477 1,159,367 75,184 193,110
Northwest Pacific 6,301,317 6,111,455 2,882,459 3,059,146
Southeast Pacific 571,223 13,041,127 50,531 232,584
West Central Pacific 1,339,206 4,784,713 607,880 552,410
World total 12,443,797 33,874,573 4,828,653 6,200,652

Source: FAO Fishstat (2003)

Research Evaluation December 2005 5

Natural resources management

Table 4. Distribution of world coral reefs by risk status and AsiaFish model (Dey et al, 2004). It is a multi-
region
market equilibrium model of the fish sector, con-
structed for each region under analysis. The follow-
Region Coral reef Present risk status (%) ing provides a concise model description; details are
area (km2) available in Briones (2004). The model consists of
Low Medium High Total equations on supply, demand, exports, and imports.
Middle East 20,000 39 46 15 100
The model data set is constructed along the lines of
Delgado et al (2003), using FAO data. Proportional
Caribbean 20,000 39 32 29 100
supply shifts, used to represent technological change
Atlantic 3,100 13 32 25 70 and the impact of research, are incorporated by the
Indian 36,100 46 29 25 100 formalism of the ‘effective price’ (Alston et al,
Southeast 68,100 18 26 56 100 1995). Changes in economic welfare (a generaliza-
Asia tion of economic surplus) are evaluated using the
Pacific 108,000 59 31 10 100 dual approach, which is a modified version of the
World 304,260 42 31 27 100 formula in Martin and Alston (1994).
A baseline simulation is conducted over a 20-year
Source: Bryant et al (1998)
period. Variables such as income and population are
exogenous to the model; projections on income are
proxied by estimates of average annual GDP growth
(Bryant et al, 1998). The study presents the percent- by region to 2015, prepared by the World Bank
age distribution of reefs in global regions classified as (2004). Population projections are based on UN es-
‘low’, ‘medium’, and ‘high’ risk (Table 4). timates by region (UN, 2004). Supply shifts under
The respondents are asked to regard these catego- the business-as-usual scenario are incorporated into
ries as proxies for extent and severity of reef dam- the baseline simulation. Supply shifts from the best-
age. They are then requested to estimate the practice scenario, modified by the adoption rates, are
percentages of low-, medium-, and high-risk coral incorporated into the counterfactual simulation. The
reefs; as with the other resource systems, the per- measure of research benefit is the welfare impact,
centages are reckoned within an interval, rather than which is the difference in welfare between baseline
an exact number. The estimates are made by region, and counterfactual simulations.
20 years hence, under the business-as-usual and Estimation of cost is however constrained by un-
best-practice scenarios. availability of data on R&D investments by resource
Also elicited is the estimate of coral reef system and region. Instead, the cost of R&D for each
productivity, that is, metric tons of reef-related fish assessment unit is approximated as some predeter-
lost on average for every square kilometer loss of mined percentage of the total value of production
coral reefs. The estimates are made separately for under the counterfactual scenario. For farm com-
the low-, medium-, and high-risk categories, by modity research, a common rule-of-thumb is that 1%
region. These productivity estimates may then be of agricultural GDP needs to be allocated to the ag-
used to convert projections of coral reef status into ricultural research and extension system to reach a
projections for reef-related fish supply by region. typical range of benefits and rates of return to re-
search (MacIntire, 1998; Roseboom, 2004). How-
Computing economic welfare impact ever investment in NRM research and applications
are more difficult to estimate. For coastal and coral
The estimated productivity changes and adoption reef systems, Balmford et al (2004) report an esti-
rates, obtained from using the foregoing methods of mate of US$ 5 to 19 billion annual cost of placing
eliciting expert opinion, are then converted into sup- 20% to 30% of the world’s oceans under marine pro-
ply shifts over time. The supply shifts may then be tected areas. This lies within 5% to 18% of the
incorporated into a baseline supply–demand model. world’s annual value of production. For developed
The model used in this study is patterned after the countries (where productivity increases in the fisher-
ies is more likely), research-management expendi-
tures range from 5% to 30% of the value of the catch
(Arnason, 2000). This is consistent for data from
OECD countries for 1999 (OECD, 2003), except for
The estimated productivity changes a few nations with low investments (Japan, Iceland,
and adoption rates are then converted and Mexico).
These costs are associated with hypothetical man-
into supply shifts over time, which agement regimes comparable to the best-practice
may then be incorporated into a scenario assumed in the expert opinion survey. For
baseline supply–demand model developing countries one may put a more conserva-
tive cost ratio of 5% for coastal and inland aquatic
systems, further adjusted downwards by the esti-
mated adoption rate for NRM research.

6 Research Evaluation December 2005

 Natural resources management

Estimates of the cost of coral reef protection
would tend towards the high end of management
costs. For example, White, Ross, and Flores (2000)
report a cost of USD 21,000 for a marine sanctuary
in the Philippines, covering one square kilometer
and producing US$ 42,000 of sustainable fisheries
per year. For coral reefs the percentage is therefore
set at 10%, likewise adjusted by the adoption rate for
NRM research on coral reefs.
Results
Estimates of resource productivity gains
The expert opinion survey covered 42 respondents.
Most (29) are from WorldFish, due to their familiarity
with NRM research in developing countries. The 13
external respondents are composed of both fishery
biologists and resource managers in both developing
country and advanced research institutions. To com-
pute supply shifts from the survey results, outliers
were eliminated and several consistency assumptions
were imposed, prior to calculating the average
estimate. For example, the business-as-usual sce-
nario should not show progressive improvement
over time; resource management may initially have a
negative effect on productivity, but eventually it
must have a positive and nondecreasing effect over
time. The average of the estimates for marine cap-
ture is shown in Tables 5 and 6.
The expected declines under the baseline scenario
are seen to be modest over the first five years.
Meanwhile, within five to ten years, production
trends are expected to deteriorate, by as much as
7.5%. Experts tend to be most optimistic for the East
Indian Ocean, but largely pessimistic over the other
oceans (for example, the Pacific). Finally, in the
long term (within 10 to 20 years), progressive
worsening under business-as-usual is evident; the
decline compared to the medium term is however
less severe. Overall, for most ocean areas, experts
conjecture a steep drop in annual production relative
to the benchmark.
Meanwhile, NRM makes a modest contribution
over the short term (in the order of 5% or less over
the benchmark). In a few cases, ideal management is
seen to cause an immediate decline in production

Table 5. Estimates of business-as-usual production trends, by FAO ocean area and fish type (% above benchmark production)

Ocean area Crustacean Demersal Mollusk Pelagic

A. Years 1 to 5 East Central Atlantic –2.5 –2.5 –2.5 –2.5

Northeastern Atlantic –2.5 –2.5 –2.5 –2.5
Southeastern Atlantic –2.5 –5.0 –1.3 –5.0
Southwestern Atlantic –2.5 –2.5 –2.5 –2.5
West Central Atlantic 0.0 0.0 –2.5 –1.7
East Indian 0.8 –3.8 0.6 –3.8
West Indian –2.5 –5.0 –2.5 –2.5
Mediterranean and Black Sea –2.5 –2.5 –2.5 –2.5
East Central Pacific –2.5 –2.5 –2.5 –2.5
Northwestern Pacific –2.5 –2.5 –2.5 –2.5
Southeastern Pacific –2.5 –3.8 0.6 –2.5
Southwestern Pacific 0.0 –2.5 0.0 –2.5
West Central Pacific 0.0 –3.6 –0.6 –1.1
B. Years 5 to 10 East Central Atlantic –6.3 –6.3 –6.3 –3.8
Northeastern Atlantic –7.5 –7.5 –7.5 –2.5
Southeastern Atlantic –7.5 –7.5 –3.8 –8.8
Southwestern Atlantic –7.5 –5.0 –5.0 –2.5
West Central Atlantic –2.5 –2.5 –7.5 –2.5
East Indian –3.3 –5.6 –1.9 –3.8
West Indian –7.5 –7.5 –5.0 –3.8
Mediterranean and Black Sea –7.5 –7.5 –7.5 –2.5
East Central Pacific –7.5 –7.5 –7.5 –2.5
Northwestern Pacific –3.8 –5.0 –3.8 –2.5
Southeastern Pacific –2.5 –3.1 –3.8 –6.7
Southwestern Pacific –2.5 –5.0 –2.5 –2.5
West Central Pacific –3.3 –7.9 –3.1 –1.8
C. Years 10 to 20 East Central Atlantic –8.8 –8.8 –8.8 –8.8
Northeastern Atlantic –7.5 –7.5 –3.8 –11.3
Southeastern Atlantic –7.5 –7.5 –3.8 –11.3
Southwestern Atlantic –7.5 –7.5 –7.5 –7.5
West Central Atlantic –7.5 –8.8 –7.5 –7.5
East Indian –3.3 –8.8 –7.5 –7.5
West Indian –11.3 –11.3 –5.0 –6.3
Mediterranean and Black Sea –7.5 –7.5 –7.5 –7.5
East Central Pacific –7.5 –7.5 –7.5 –7.5
Northwestern Pacific –3.8 –5.0 –3.8 –5.0
Southeastern Pacific –2.5 –6.3 –3.8 –12.5
Southwestern Pacific –3.8 –7.5 –3.8 –5.0
West Central Pacific –4.0 –14.2 –3.1 –8.3

Source: Authors’ survey

Research Evaluation December 2005 7

Natural resources management

Table 6. Estimates of production trends under the ‘best-practice’ scenario, by FAO ocean area and fish type (% above benchmark
production)

Ocean area Crustacean Demersal Mollusk Pelagic

A. Years 1 to 5 East Central Atlantic 7.5 7.5 7.5 7.5

Northeastern Atlantic 2.5 2.5 2.5 2.5
Southeastern Atlantic 2.5 –6.2 2.5 –6.2
Southwestern Atlantic 2.5 5 5 2.5
West Central Atlantic –2.5 3.3 8.8 0
East Indian 2.5 3.1 4.4 2.5
West Indian 1.2 2.5 1.2 1.2
Mediterranean and Black Sea 2.5 2.5 2.5 2.5
East Central Pacific 2.5 2.5 2.5 2.5
Northwestern Pacific 0.8 0.8 0 0.8
Southeastern Pacific 1.7 1.9 0.8 0
Southwestern Pacific 5 2.5 2.5 2.5
West Central Pacific 0.8 –1.0 2.5 1.0
B. Years 5 to 10 East Central Atlantic 13.8 16.3 16.3 20.0
Northeastern Atlantic 2.5 7.5 7.5 15.0
Southeastern Atlantic 2.5 5.0 0.0 11.3
Southwestern Atlantic 2.5 7.5 7.5 15.0
West Central Atlantic –2.5 0.0 7.5 6.3
East Indian 5.0 10.0 5.8 8.8
West Indian 1.3 3.8 3.8 7.5
Mediterranean and Black Sea 2.5 7.5 7.5 15.0
East Central Pacific 2.5 7.5 7.5 15.0
Northwestern Pacific 1.3 3.8 3.8 11.3
Southeastern Pacific 3.3 5.6 4.4 5.0
Southwestern Pacific 5.0 7.5 7.5 8.8
West Central Pacific 1.7 1.7 5.0 4.3
C. Years 11 to 20 East Central Atlantic 28.8 32.5 28.8 40.0
Northeastern Atlantic 7.5 15.0 7.5 30.0
Southeastern Atlantic 7.5 22.5 0.0 30.0
Southwestern Atlantic 7.5 15.0 7.5 30.0
West Central Atlantic 0.0 3.8 7.5 13.8
East Indian 11.3 17.5 7.5 18.8
West Indian 7.5 15.0 7.5 30.0
Mediterranean and Black Sea 7.5 15.0 7.5 30.0
East Central Pacific 7.5 15.0 7.5 30.0
Northwestern Pacific 3.8 7.5 3.8 16.3
Southeastern Pacific 5.0 7.5 4.4 4.2
Southwestern Pacific 11.3 22.5 11.3 18.8
West Central Pacific 5.6 5.0 9.4 10.4

Source: Authors’ survey

(probably as fishing pressure is reduced). In the
medium term the deterioration of production
(expected under the business-as-usual scenario) is
almost completely reversed. The improvement is
particularly sharp in the case of finfish. Interestingly,
crustacean production on average is not expected to
be appreciably helped by best-practice management.
In the long term, ideal management leads to a range
of improvement for every ocean area and fish type
(except for mollusks in Southwestern Atlantic). The
magnitude of the productivity gains is well below
the shift implied by the global estimate of potential
yield in Pauly (1996); the estimates may therefore be
considered conservative, and probably more realistic
given the 20-year horizon of the projections and the
ecological lags of stock recovery.
For inland capture, the expert survey obtained a
similar pattern for the two scenarios (Table 7).
Overall, the trend deterioration (under business-as-
usual) is less pronounced compared to the same sce-
nario for marine capture. Apparently, the degree of
excess fishing pressure and recoverability of fish
stocks seem to offer worse prospects for marine
compared to inland capture. The worst deterioration
is projected for East Asia, across all periods; the
mildest is for Sub-Saharan Africa, with the long-
term production decline of less than 6% relative to
the benchmark. This may be attributed to the rela-
tively low levels of exploitation of inland aquatic
systems in this region, relative to other regions.
Interestingly, Sub-Saharan Africa shows the sec-
ond largest impact of resource management in the
long run. Compared to marine capture, the impact of
management intervention is greater. Some respon-
dents explained that measures for increasing produc-
tivity, such as stock enhancement, are far more
feasible for inland fisheries compared to their marine
counterparts. Supply shifters (sans adoption modifi-
ers) use this information, and allocated by a 67%:33%
ratio for lakes and rivers, respectively (ICLARM,
1992, 1999). The exception is Sub-Saharan Africa,
where the ratio is 50%:50% due to the relatively large
contribution of the great lakes in southern Africa.
The last set of shifters is computed for fisheries
related to coral reefs. The relevant coral reef regions
are South Asia, Southeast Asia, Sub-Saharan Africa,

8 Research Evaluation December 2005

 Natural resources management

Table 7. Estimates of productivity trends and NRM shifters, inland capture, by scenario, time horizon, and region (% above
benchmark production)

Scenario Business as usual Ideal management

Region 1 to 5 5 to 10 10 to 20 1 to 5 5 to 10 10 to 20

EA –5.0 –10.0 –13.8 4.4 10.6 13.8

SA 0.9 –3.3 –5.8 3.8 10.5 13.8
SEAI 1.3 –3.1 –0.6 4.4 16.3 17.5
SEAM –1.4 –6.1 –10.7 4.3 11.4 13.2
SSA –0.8 –3.3 –5.8 4.2 11.1 17.2
WANA –2.5 –6.7 –7.5 3.5 8.5 11.0

Source: Authors’ survey

and the Middle East. Expert opinion projects a steep
decline of the percentage of low-risk reefs within 20
years (Table 8), accompanied by a surge in the high-
risk category. Meanwhile, ideally management does
make a considerable difference, even over a rela-
tively short period of time: a small to nonexistent
extent of reefs in the high-risk zone are projected,
while the low-risk category characterizes up to 65%
of reefs in South Asia and the Middle East. However
due to lags in the coral reef recovery, even with ideal
management, less than 40% of coral reefs in South-
east Asia are classified under low risk.
Table 8 also displays expert opinion on the quan-
tity of fish per year produced, directly or indirectly,
by these reefs per unit area. For relatively pristine
coral reefs (that is, under ‘low risk’), the highest
productivity is estimated for Southeast Asia.
Adoption of best-practice management
The average estimate based on expert opinion on the
adoption of ideal management is shown in Table 9.
Experts tend to be very circumspect in their projec-
tions about management practice and policy applica-
Table 8. Estimates of coral reef risk status in 20 years, under
alternative scenarios, in %, and reef productivity,
in mt
South Southeast Sub-
Asia Asia Saharan
Africa
tion. Gains are estimated to be very low, over the
next ten years, for all regions and resource systems.
In East Asia, owing to the policy environment, adop-
tion of ideal management is seen to be very low
across resource systems.
Despite the low levels of development of institu-
tions and governance in Sub-Saharan Africa, the
highest potential adoption is projected for this region
across all resource systems. It is matched in coral
reefs and inland capture by Southeast Asia–Island,
where institutions tend to be better developed and
considerations of sustainability better articulated in
the policy agenda. These figures are used to param-
eterize the logistic adoption function, which acts as
the modifier for the NRM shifter under the best-
practice scenario.
Impact on economic welfare
Applying the above shifters and other exogenous
variables to the baseline model, one can compute the
economic welfare impact from NRM research and
its application. The relatively small production cov-
erage of coral reef systems in East Asia and
mainland Southeast Asia precludes the application
of a price adjustment mechanism, as errors in model
solution would tend to be large relative to the actual
research impact. For these units, the counterfactual
simulation assumes a production and price that is
Middle unaffected by supply shifts from research and appli-
East
cation of NRM.

Low risk
Business-as- Table 9. Estimates of adoption rates for best-practice
usual 0.0 7.8 0.0 15.0 management, in 10 years and ceiling, by developing
Best-practice 65.0 36.7 50.0 65.0 region and resource system
Medium risk
Business-as-
Coast Coral Inland capture
usual 20.0 24.0 20.0 46.5
Best-practice 20.0 30.8 40.0 30.0
10 Ceiling 10 Ceiling 10 Ceiling
High risk years years years
Business-as-
usual 80.0 68.2 80.0 38.5
Best-practice 15.0 32.5 10.0 5.0 EA 5.0 10.0 4.3 8.3 6.7 11.7
SA 4.3 15.0 4.0 15.0 7.5 18.8
Productivity SEAI 7.5 20.0 12.6 24.0 12.0 24.0
Low risk 25.8 32.5 18.8 25.8 SEAM 10.6 18.0 7.5 13.8 7.0 19.0
Medium risk 16.7 21.0 12.5 16.7 SSA 10.0 25.0 15.0 30.0 11.0 24.0
High risk 8.3 11.6 5.0 8.3 WANA 7.5 13.8 11.8 18.8 7.5 15.0

Source: Authors’ survey Source: Authors’ survey

Research Evaluation December 2005 9

Natural resources management

The economic welfare impact (under the Benefit
column) and estimated costs are shown in Table 10.
The figures correspond to the net present value over
a 20-year period, using a discount rate of 5%, a level
recommended by Alston et al (1995). Also shown in
Table 10 are the relative benefit–cost ratios, which
serve as the basis for ranking the R&D units in terms
of net economic impact.
Results indicate that coastal NRM in SEA–Island,
SEA–Mainland, SSA, and coral reef NRM in SEA–
Island generate the greatest gross benefits. However,
coral reef systems in Sub-Saharan Africa, South
Asia, and mainland Southeast Asia offer the highest
benefit relative to cost. This holds despite the higher
cost percentage assumed for coral reef systems, and
may therefore be seen as a fairly robust feature in the
impact ranking. Interestingly, the large coral reef
system in island Southeast Asia ranks fifth, preceded
by rivers in East Asia. Other inland water systems
complete the top ten places; the first coastal system
ranks 11th, for East Asia. Apparently, the larger sys-
tems are accompanied by lower supply shifts, rela-
tive to the price adjustment, which together vitiate
the role of size in ranking the potential impact of
research.
to conventional economic techniques of evaluation.
This study demonstrates that, on the contrary, NRM
research can be evaluated largely along conventional
lines. The key is to articulate the impact pathway of
NRM research, in a manner parallel to farm com-
modity research. With this framework, the usual
tools of expert opinion and economic surplus analy-
sis can be applied for computing measures such as
the welfare impact, the cost of R&D, as well as the
benefit–cost ratio. The method is applied to inter-
national research on aquatic resources, in the case of
the WorldFish Center. The results indicate that re-
search and application of NRM yields the highest
net benefits for the smaller aquatic systems, particu-
larly for coral reefs. The larger systems (particularly
coasts) are assessed as a lower economic impact
once price adjustments are incorporated into the
evaluation of benefits and costs.
Further research is needed on achieving greater
accuracy in estimating supply shifts and adoption
rates, particularly as the current set of assumptions is
constrained by the sparseness of data, relevant case
studies, and related information. This study may be
seen as offering a workable method for quantitative
economic studies of ex ante impact of NRM
research.

Conclusion
Notes
In recent years, NRM has gained prominence along-
side farm commodities as a area of agricultural re- 1. NRM also acts to regulate externalities from various forms of
resource use, not necessarily confined to harvesting natural
search. However the ex ante impact of NRM stocks. For example, farms may use the waste disposal ser-
research is seldom evaluated, with the literature as- vices of natural systems, or expand production area by con-
sessing this type of research as particularly resistant version of natural systems (for example, mangroves).
Regulation of externality is a critical function of NRM; how-
ever this treats it as a separate quantification problem that
lies outside the scope of this study.
2. Research on innovative farming systems that promote long-
Table 10. Benefit–cost ratio for NRM research, by region– term resource sustainability, such as IPM (integrated pest
resource system management) or IAA (integrated aquaculture-agriculture),
have also been classified under NRM research. While the
ambiguous nature of this research activity is recognized, this
Benefit Cost BCR study classifies them under farm commodity research as the
technologies generated are applied on divisible resource
1 SSA – Coral 157,733 23,075 100.00 systems.
2 SA – Coral 396,959 67,731 85.74 3. Alternatively, one may calculate a discrete-time version of
3 SEAM – Coral 132,935 23,959 81.17 the logistic equation, consistent with the estimate based on
4 EA – Rivers 31,057 11,358 40.00 years. However the continuous time formulation of equation
5 SEAI – Coral 1,313,675 510,756 37.63 (3) is also perfectly acceptable.
6 SEAM – Rivers 85,930 44,304 28.37
7 SA – Rivers 81,517 43,138 27.64
8 EA – Lakes 39,093 23,074 24.78
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