The role of International Tropical Timber Agreement of 1994 in conservation of tropical forests - ITTO's year 2000 objective and its compatibility with economic theories -

Abstract

The ITTA of 1994 was adopted as a more conservation oriented agreement than the previous ITTA of 1983, responding to the growing global concern on the tropical forest depletion as clearly expressed in the 1992 Rio Accords. The Bali Partnership Fund was established under its article 21 to provide funds to achieve sustainable management of tropical timber trade by the year 2000. However, detailed implementation schemes, including the amount of contribution needed to the Fund and the level at which the sustainable management of tropical timber trade is satisfied, have not been agreed among the member countries of ITTO. International environmental issues are often analyzed in light of the collective action problems. Traditional game theory would predict that negotiations on contribution allocation for environmental conservation would fil because of the free-rider problem. The absence of an effective enforcement institution is the main reason behind this prediction. International agreements could provide a solution to overcome the collective action problem in the field of environmental conservation. A number of games are played on the models representing the Bali Partnership Fund in this thesis. Those games indicated that effective equilibrium amounts of contribution between producing and consuming member countries of ITTO could be obtained, particularly when both sides recognize the same values in the tropical forest conservation. This value sharing could be achieved under the ITTA of 1994 if the member countries succeed in negotiations to set up concrete action plans for the Bali Partnership Fund. Another crucial factor for the games to succeed is the introduction of penalty clauses in the implementation scheme of the Bali Partnership Fund. The games with a penalty factor in this thesis all turned out to produce successful solutions.