Over at Market Design blog, Al Roth flags an interesting controversy developing in South Africa – whether to abandon the current ban on Rhino horn and horn products, in favor of a regulated market in sustainably harvested Rhino horn. Both the WSJ and NY Times carry recent articles.
As a bit of background (from the WSJ):
“The global rhino population has dwindled from 500,000 at the beginning of the 20th century to about 29,000 today. The surging trade in illicit horn has cut the population of the three remaining Asian species to just a few thousand, including about 40 Javan and less than 100 Sumatran rhinos. Just about 20,000 Southern White Rhinos and 5,000 black rhinos, which include three subspecies in Africa, survive.
“Black-market rhino horn can fetch as much as $100,000 a kilogram in Vietnam and other Asian countries, where it is peddled as a cure for ailments ranging from headaches to cancer.”
I find this latest controversy interesting, because it highlights some pretty standard debates about taboo markets in a new context. For example, one common point of contention is whether, when banning the market has failed to stop trading, society is better served by a regulated, legal market.
This debate has occurred recently with respect to markets in prostitution and human organs, for example. In the case of Rhino horn, advocates of a legalized market argue that sustainable herding would both reduce the demand for poached horn and apply price pressure, thus dampening incentives to poach. Again, from the WSJ:
Rhino horn is made of keratin, like human fingernails. It grows as much as 5 inches a year. Biologists say that as long as a stump of 2 to 3 inches remains, it can be trimmed, doing a rhino no more harm than a manicure. “There are no nerves in rhinos’ horns,” said Raoul du Toit, director of Zimbabwe’s Lowveld Rhino Trust. He said there is no evidence that the procedure affects rhinos’ breeding practices or leaves them more susceptible to predators. “Why would you hunt a rhino for seven, eight, nine, 10 kilos of horn when, in a lifetime, it can grow 70 kilos of horn?” Mr. Hume asked.
Many animal rights activists disagree, arguing that a legal market would make enforcement more difficult and raise demand by whetting appetites for Rhino horn, as apparently happened after a one-time sale of elephant ivory stockpiles in 2008. They insist that education and publicity campaigns designed to counter myths regarding Rhino horns’ healing powers are the answer.
Market advocates counter that time is of the essence – Rhino populations are now so low that we can’t afford to wait for societal views to change — and dispute the lessons learned from the 2008 ivory auction:
The sides argue about precedents. A one-off sale of elephant-ivory stockpiles from four southern African nations in 2008 only whetted appetites for tusks, and elephant poaching has since soared to all-time highs. But a sustained, legal tide of supply—not a brief flood—has worked for other species, like South America’s vicuña, a llama relative. Mr. Hume notes that vicuñas were once slaughtered for their softer-than-cashmere coats but are now farmed sustainably, back from the edge of extinction.”
And, as with other taboo trades, you can count on the opponents to differ when it comes to concerns about commodification and the crowding out of nonmarket ideals:
“Where we differ is with your attitude towards the exploitation of an endangered species with the intention of making large profits,” Margot Stewart, founder of the nonprofit group Wild and Free South Africa, wrote in an open letter to Mr. Hume. She argues that rhinos are wild animals and should not be kept in paddocks like sheep or cows—and that it is unethical to farm and sell rhino horn since it has zero medicinal value. “Only two parties want this to continue: the rhino farmers and organized crime syndicates,” she added.
Market Design: Rhino horns: flood the market with sustainable horn, instead of prohibiting the market?
WSJ: Would a Legalized Horn Trade Save Rhinos? With poaching on the rise, ranchers in South Africa want to flood the market—but conservationists warn of corruption and cruelty
NY Times: U.S. Pours Millions Into Fighting Poachers in South Africa