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Although Dr. Loomis' comments on our chapter are generally favorable, he points to the omission of nonmarket benefits associated with critical habitat designation as an area for improvement. We agree. From a pragmatic perspective, however, incorporating such estimates into our analysis would be difficult. As Dr. Loomis noted, benefit studies associated with preserving such species as the Colorado squawfish, humpback chub, bonytail, and razorback sucker were not available at the time our analysis was performed. Furthermore, time and resources were not available to develop benefit estimates for preserving these species using contingent valuation or other nonmarket valuation techniques. Dr. Loomis suggests that we could have surveyed the literature on the economic value of other T&E species and incorporated such nonmarket values into the CGE model using benefit transfer techniques. That suggestion, however, ignores the unique and controversial way in which some native fishes of the Colorado River system are viewed by various segments of the public and fisheries management professionals.
Prior to passage of the Endangered Species Act, many native fishes in the basin were considered “trash” fishes that competed for habitat with salmonoid species that were introduced for sport fishing purposes. In fact, various species of suckers and chubs were routinely poisoned in the 1950s and 1960s in an attempt to enhance recreational fisheries. Perhaps the best example of such actions is the use of rotenone in 1962 to remove almost all native fishes from Wyoming's Green River system above newly constructed Flaming Gorge Reservoir.
The Endangered Species Act (Act) of 1973, as amended, assigns the U.S. Fish and Wildlife Service (USFWS) the responsibility for listing species of plants and animals in the United States whose existence is either threatened or endangered. After a species is listed, the Service is responsible for, among other things, developing recovery plans, reviewing proposed federal actions to ensure that they do not compromise recovery efforts, and designating critical habitat for listed species. Such critical habitat designations, at least in certain situations, can alter economic activity in critical habitat areas that might otherwise be of detriment to certain species. Although the Act has no provisions for studying the economic consequences of listing threatened and endangered species, it does require the Service to assess the economic impacts of all proposed critical habitat designations. As a result, economists have been participating in the ongoing process of designating critical habitat for endangered species and assessing the economic impacts of such designations.
Critical habitat designations impose use restrictions on lands that can change the way in which economic resources are allocated. Threatened and endangered species are usually listed because the current allocation of resources has resulted in excessive habitat degradation. Such adverse modification of natural habitat is generally due to economic activity that has occurred as a result of human settlement and economic development. Resources are allocated to particular uses as a result, and stabilizing and/or reversing this development requires that these resources be allocated to other uses.
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