Person:
Damania, Richard
Author Name Variants
Fields of Specialization
Development Economics, Environmental Economics, Natural Resource Economics, Agricultural Economics, Water Economics, Game Theory
Degrees
Externally Hosted Work
Contact Information
Last updated
August 30, 2023
Biography
Richard Damania is the Chief Economist of the Sustainable Development Practice Group. He has held several positions in the World Bank including as Senior Economic Advisor in the Water Practice, Lead Economist in the Africa Region’s Sustainable Development Department, in the South Asia and Latin America and Caribbean Regions of the World Bank. His work has spanned across multiple sectors and has helped the World Bank become an acknowledged thought-leader on matters relating to environment, water and the economy. Prior to joining the World Bank he held positions in academia and has published extensively with over 100 papers in scientific journals.
Publication Search Results
1 - 10 of 10
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Publication
Ecosystems : Burden or Bounty?
(World Bank, Washington, DC, 2014-05)This paper presents a somewhat novel approach to explore the economic contribution of ecosystems. It develops linked models to capture connections between resource stocks and flows and the resulting microeconomic and macroeconomic impacts. A bioeconomic model is developed that is imbedded into a computable general equilibrium (CGE) model. Incorporating imperfect regulation, the bioeconomic model characterizes optimal policies, while the CGE model explores the economy-wide consequences of possible changes to the ecosystem. The model is parameterized and calibrated to the case of the Serengeti ecosystem which is perhaps the most intensively researched biome with a relative abundance of data. This ecosystem is also undergoing rapid change from a host of factors related to developments within and around the protected area system. The analysis identifies the contribution of the ecosystem to the economy and finds that changes in tourism and bushmeat hunting have surprisingly diffuse economy-wide impacts, that are especially large in the rural sector. To guard against overstatement, ecosystem impacts are under-stated relative to other effects. The results suggest that linkages to the natural resource sector (backward and forward multipliers) are important and neglecting these may lead to biased estimates. -
Publication
Road Improvement and Deforestation in the Congo Basin Countries
(World Bank, Washington, DC, 2015-05)Road construction has often been viewed as the precursor to deforestation, especially in tropical forests. Traditional responses to such threats have been reactive, with attempts to mitigate impacts through physical measures, or the establishment of protected areas. These approaches often have not been entirely successful, especially in areas where economic potential is significant. This paper seeks to mitigate such conflicts by proposing a proactive approach to development planning and environmental policy. It develops a high-resolution spatial model of road improvement impacts that includes ecological risks and the economics of forest clearing. The approach is implemented by estimating the potential impact of road upgrading on forest clearing and biodiversity in eight Congo Basin countries. The paper demonstrates how the detailed analysis can identify areas of high ecological priority as well as areas at high risk of forest loss. The paper contributes to several aspects of the literature. First, it provides the most recent and reliable estimates of the drivers of deforestation in the Congo Basin, with the latest high-resolution satellite data on forest cover changes. Second, it presents novel estimates of biodiversity threats by creating an index that combines and synthesizes several measures of biodiversity loss and impacts. It then develops an empirical framework for estimating the ecological impacts of road improvement. Finally, the paper illustrates how the empirical framework can be used to preempt impacts and avoid potential ecological damage. -
Publication
Economic Boom or Ecologic Doom?: Using Spatial Analysis to Reconcile Road Development with Forest Conservation
(Washington, DC: World Bank, 2016-05-20)The natural endowment of the Democrat Republic of Congo, in the form of land, minerals, and forests, is unparalleled. The right mix of policies has the potential to unleash incentives that could transform the economy. However, transport infrastructure in the DRC is amongst the sparsest and most dilapidated in the world, and this lack of infrastructure is likely a significant constraint to growth. This work considerably advances the information that is available to infrastructure planners, and provides methodologies that could be used to make more informed decisions to identify trade-offs between economic growth and environmental endangerment. The approach draws from the state-of the art across a variety of disciplines – spatial (GIS) analysis, spatial econometrics, economic theory, and conservation biology – to create an approach that can guide the location and level of investments by estimating benefits and environmental costs at a highly disaggregated spatial scale. The analysis proceeds in four related phases that combine economic assessments with geospatial analysis. First transport costs are estimated using GIS techniques. A variety of econometric procedures are then used to determine the economic effects of changing transport costs. Second, highly disaggregated spatial data is used to estimate the effects of roads on forest cover, and the resulting biodiversity that would be at risk from local deforestation. Next the two spatial estimates are combined to simulate the effects of different policies. Finally this provides a series of maps that identify regions where there are large trade-offs between economic and ecological goals. Overall the results suggests that the siting of infrastructure needs to consider impacts at the very outset of the planning process. This report presents both new data and new techniques that can be used to identify areas of opportunity, risk, and potential for REDD+ financing. Such upstream planning has been rendered both feasible and cost effective with the availability of geo-referenced information on forest cover and economic data. This report provides the data and easily comprehensible maps for such an exercise. -
Publication
Transport, Economic Growth, and Deforestation in the Democratic Republic of Congo: A Spatial Analysis
(World Bank, Washington, DC, 2016-01-13)The purpose of this study is to demonstrate several techniques which can be used to evaluate pathways to sustainable growth in the Democratic Republic of Congo (DRC) via infrastructure improvement. Decades of conflict and neglect have left the DRC’s transport infrastructure amongst the sparsest and most dilapidated in the world. -
Publication
The Impact of Water Quality on GDP Growth: Evidence from Around the World
(World Bank, Washington, DC, 2019-12-10)Declining water quality can impact the economy in various ways. Impacts can be found in the health sector, where labor productivity can be affected, in agriculture, where the quality and quantity of food produced can be reduced, and in tourism, real estate, aquaculture/fisheries and other sectors which rely on environmental quality and ecosystem services. Despite these well-known impacts, finding economy-wide affects of water quality on economic activity can be elusive. In this paper we attempt to fill this gap by using a conventional empirical approach in contemporary environmental economics and new data on economic activity and water quality for nineteen countries from 1990-2014. The authors find that when rivers become very heavily polluted, regions downstream see reductions in economic growth, losing between 0.8 and 2.0 percent of economic growth. These losses imply that in many places, the costs of environmental degradation are severely under-estimated and well above efficient levels. -
Publication
The Nitrogen Legacy: The Long-Term Effects of Water Pollution on Human Capital
(World Bank, Washington, DC, 2019-12-10)The fallout of nitrogen pollution is considered one of the largest global externalities facing the world, impacting air, water soil and human health. This paper presents new evidence that nitrogen pollution in water is an important determinant of variations in human capital. Data from the Demographic and Health Survey dataset across India, Vietnam, and 33 African countries are combined to analyze the causal links between pollution exposure experienced during the very earliest stages of life and later-life health. Results show that pollution exposure experienced in the critical years of development from the period of birth up until year three – is associated with decreased height as an adult, a well-known indicator of overall health and productivity, and is robust to several statistical checks. Because adult height is related to education, labor productivity, and income, this also implies a loss of earning potential. Results are consistent and show that early-life exposure to nitrogen pollution in water can lower height-for-age scores during childhood in Vietnam and during infancy in Africa. These findings add to the evidence on the enduring consequences of water pollution and identify a critical area for policy intervention. -
Publication
Quality Unknown: The Invisible Water Crisis
(Washington, DC: World Bank, 2019-08-20)Water quantity—too much in the case of floods, or too little in the case of droughts—grabs public attention and the media spotlight. Water quality—being predominantly invisible and hard to detect—goes largely unnoticed. Quality Unknown: The Invisible Water Crisis presents new evidence and new data that call urgent attention to the hidden dangers lying beneath water’s surface. It shows how poor water quality stalls economic progress, stymies human potential, and reduces food production. Quality Unknown examines the effects of water quality on economic growth and finds upstream pollution lowers growth in downstream regions. It reveals that some of the most ubiquitous contaminants in water, such as nitrates and salt, have impacts that are larger, deeper, and wider than has been acknowledged. And it traces the damage to crop yields and the stark implications for food security in affected regions. An important step toward tackling the world’s water quality challenge is recognizing its scale. The world needs reliable, accurate, and comprehensive information so that policy makers can have new insights, decision making can be evidence based, and citizens can call for action. The report calls for a paradigm shift that emphasizes safer, and often more cost-effective remedies that prevent pollution by combining smarter policies with newer technologies. A key message of Quality Unknown is that such solutions exist and change is possible. -
Publication
When Good Conservation Becomes Good Economics: Kenya’s Vanishing Herds
(World Bank, Washington, DC, 2019-10-07)It is no exaggeration to state that Kenya’s wildlife has done much to shape the image and development fortunes of the country. Today tourism is among Kenya’s top sources of foreign exchange, dominates the service sector, and contributes significantly to employment, especially in rural areas where economic opportunities are limited. The typical international tourist arrives on a package tour that may include a safari, a visit to the beach, or both. It is safari tourism, however, that generates the most employment and economic activity across the country. But the wildlife that has lured travelers to Kenya by the planeload is in dramatic decline. In the past three decades, the country has lost more than half of its wildlife. Wild herds that once roamed freely across the borders of Kenya and Tanzania have shrunk dramatically in numbers and vanished completely from much of the North. Perhaps most troubling is that recent monitoring of wildlife populations suggests that long-term declines of many of the charismatic species that attract tourists like lions, elephants, giraffes, impalas, and others are occurring at the same rates within the country’s national parks as outside of these protected areas. This report identifies with greater precision the drivers of land conversion from natural habitats to other uses, and examines the extent to which land conversion leads to the extirpation of wildlife and the loss of tourism incomes. -
Publication
The Macroeconomic Impact of Future Water Scarcity: An Assessment of Alternative Scenarios
(Elsevier, 2017-11)In this paper we consider some of the economic implications of climate change scenarios as described in the Shared Socioeconomic Pathways (SSPs). By comparing potential water demand with estimates of (sustainable) water availability in different regions, we identify regions that are likely to be constrained in their future economic growth potential by the scarcity of water resources. We assess the macroeconomic impact of water scarcity under alternative allocation rules finding that, by assigning more water to sectors in which it has a higher value, shifting production to less water intensive sectors, and importing more water intensive goods, constrained regions can effectively neutralize these water related climate risks and adapt to a changing water environment. However, this adaptation effort is likely to imply some radical changes in water management policies. -
Publication
Uncharted Waters: The New Economics of Water Scarcity and Variability
(World Bank, Washington, DC, 2017-10-24)The 21st century will witness the collision of two powerful forces – burgeoning population growth, together with a changing climate. With population growth, water scarcity will proliferate to new areas across the globe. And with climate change, rainfall will become more fickle, with longer and deeper periods of droughts and deluges. This report presents new evidence to advance understanding on how rainfall shocks coupled with water scarcity, impacts farms, firms, and families. On farms, the largest consumers of water in the world, impacts are channeled from declining yields to changing landscapes. In cities, water extremes especially when combined with unreliable infrastructure can stall firm production, sales, and revenue. At the center of this are families, who feel the impacts of this uncertainty on their incomes, jobs, and long-term health and welfare. Although a rainfall shock may be fleeting, its consequences can become permanent and shape the destiny of those who experience it. Pursuing business as usual will lead many countries down a “parched path” where droughts shape destinies. Avoiding this misery in slow motion will call for fundamental changes to water policy around the globe. Building resilience to rainfall variability will require using different policy instruments to address the multifaceted nature of water. A key message of this report is that water has multiple economic attributes, each of which entail distinct policy responses. If water is not managed more prudently—from source, to tap, and back to source—the crises observed today will become the catastrophes of tomorrow.