Mixing Oil and Water : Studies of the Namibian Economy

Abstract: This thesis consists of four papers studying economic aspects of natural resource and environmental management in Namibia.Paper [I] analyses changes in Namibian energy use patterns between 1980 and 1998. The study finds that, unlike their counterparts in many other developing countries where energy use has been studied, Namibian energy users appear to have been quite flexible in changing to energy-saving technologies and to technologies using different energy sources altogether. One explanation for this difference may be that Namibia has had relatively high energy prices and has had high taxes on oil-based fuels, which may have made Namibian energy users more interested in potential energy savings.Paper [II] studies variables affecting property pricing in the township areas of Windhoek, Namibia’s capital city. Plots close to a garbage dump sell at substantial discounts, while plots close to a recreation area sell at premium prices. These results suggest that environmental quality may be more important for households in township areas than has previously been believed. Neglecting issues of environmental quality in town planning for township areas may thus be a serious omission.Paper [III] uses Namibian farm price data to study the impact of groundwater access on farm profitability. Potentially, groundwater can function both as an extra source of water in areas with low rainfall and as a buffer source of water in areas where rainfall is higher but variable. If groundwater mainly functions as a buffer source of water in high-rainfall areas, it could be replaced by various means of water storage fairly easily. Providing extra water by other means in low-rainfall areas, on the other hand, is likely to be prohibitively expensive. The study does not provide clear-cut results, suggesting that on precautionary principles one should assume that groundwater will be difficult to replace with other water sources.Paper [IV] studies optimal allocation between commercial and recreational fishing for one of Namibia’s fish species, the kob. The biological dynamics of the kob are modelled using an age-class model with age-specific mortalities, in order to capture the fact that the two fisheries target different age classes. The length of the planning horizon is crucial for the results: If a short planning horizon is used, the results indicate that a large share of the catches should be allocated to commercial fishing. With a longer planning horizon, however, the higher profitability of recreational angling leads to the conclusion that it would be preferable to limit commercial fishing in order to permit kob stocks to recover and improve angling success.