The Ivory Crush: When wishful thinking meets bad economics

By Brendan Moyle 04/03/2014

Elephant poaching exploded in the late 2000s.  This has led to a range of measures to stop this traffic. Some are quite sensible- increased international cooperation and coordination on enforcement has had successes.  Both Operation Cobra (2013) and Operation Cobra II (2014) shattered some conspiracies in Africa and Asia.  Some measure, well, seem to be applied in haste and with little reason. The wave of ivory crushes initiated by the USA is one of these.

Countries have been acquiring ivory for years.  Some ivory is gathered from natural mortality and culls (in Africa).  Some ivory comes from seizures made by enforcement agencies.  A lot of this ivory is held in consumer-states.  Ivory is after all, a durable product.  It can be easily stored.

So, what’s the rationale behind destroying this ivory?  Advocates claim that it sends a signal that this time, the international community is serious. That by destroying legal stockpiles of ivory, consumers will realise that buying ivory products is bad. This is part of a long line of similar gambits. Kenya’s graphic burn of 12 tons of ivory in 1989 was supposed to do just this. The CITES Appendix Listing (1989) leading to the ban in international trade in ivory (1990) also was supposed to do this.

I suppose this could work if Asian consumers of ivory products wanted the approval of conservationists- especially Western conservationists- more than anything else. If on the other hand, centuries of cultural use is the more important driver then we’d see persistent demand over decades.  Yeah. I think that question has been answered.

The problem with the ivory-crush is perception.  With little forethought, it is just being presumed that buyers of ivory will perceive ivory to be less desirable.  The risk is that it bolsters the rarity-value of ivory.  That those in the market will think it becomes even more valuable. The important thing is not to change the perceptions of people who aren’t in the ivory market.  That’s a lot of China or Japan.  The important thing is the perceptions of the people actually in the market.

This is what we warned in our South China Morning Post op-ed.  If the buyers and sellers in this market come to regard ivory as more valuable, then it’s not going to slow down poaching. Prices will go up as a result of this perception. It will actually encourage more poaching.  We are creating a perception that there is a crisis with elephants, that ivory will become scarcer. Surprisingly, there are already early signs that this is occurring.

One seller at an ivory stall in Beijing’s Tianya Antique Market commented that “the government’s destruction of its ivory stocks has actually done us some good.” He explained that while smaller merchants were finding it harder to source quality goods, the larger ones still had suppliers and were benefiting from higher prices [link]

Initially, Hofford says, the move to destroy so much ivory appears to have driven up prices by about 10 percent in Hong Kong. [link]

Let me conclude with out SCMP Op-Ed

Conserving elephants is a laudable international goal. Destroying ivory stockpiles has no record of success and it has grave risks that are being overlooked in the rush to destroy. Effective policies must be based on compelling evidence and not on popular, wishful thinking.

I can understand the motivation to be seen to be ‘doing something‘ to reduce the illegal trade in ivory.  But this does not mean we should ditch the principles of good policy-making. It does not mean that we should be taking risky gambles.  The premise that making something scarcer will reduce its market value is extraordinary, and needs compelling evidence. None has been provided.