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The Economics of Illegal Ivory

The U.S. Fish and Wildlife Service says destroying ivory can reduce supply and demand at same time.


In a visually dramatic display, designed to attract as much press attention as possible, the U.S. Fish and Wildlife Service crushed its entire stockpile of illegal ivory tusks and carvings, confiscated over the past 25 years. “Some six tons of ivory were pulverized by an industrial rock crusher in front of some of the world’s most influential conservationists,” proclaimed a FWS press release last week. It said that the event, which took place at a wildlife refuge outside Denver, sent “a clear message that the nation will not tolerate wildlife crime that threatens to wipe out the African elephant and a host of other species around the globe.”

A previous post about the fight against rhino poaching referenced the debate over whether legalization and regulation of the horn and ivory market could potentially increase supply and lower prices. The FWS has made a loud and clear statement here about which side of the debate it lands on. But why? A devil’s advocate approach: Reducing supply typically increases demand, yes? Won’t destroying all this ivory make the rest of the ivory that’s still on the market more expensive, and therefore give poachers even more motivation to continue their deadly trade? For instance, what if, instead of crushing it, the FWS could sell off its stockpile in some type of regulated way, and flood the market in the process?

“We get asked that question all the time,” says Gavin Shire, public affairs specialist at the U.S. Fish and Wildlife Service. He goes on to explain why basic supply-and-demand analyses are insufficient here.

The FWS hopes that the highly-publicized crush will inspire other countries to do the same with their stockpiles, and to start public awareness campaigns there about the impact of the trade.

First, the FWS would not be allowed to sell the ivory products, anyway; what the department has stockpiled, it seized in the first place because it was being sold illegally. (Some antique ivory is legal to sell, with the proper permits, but this ivory was new, and had been poached.) If it’s illegal for poachers and dealers, then it should be illegal for government departments and agencies, too. Zero tolerance means zero tolerance.

Second, as to the supply-demand question, Shire says that whether this particular portion were in play or not, it wouldn’t actually make any financial difference to the market either way. This stockpile certainly looks impressive, going through a giant rock crusher, but it is actually relatively small, Shire says. “Flooding the market” artificially would be nearly impossible, considering the sheer size of that market.

Shire says he can’t accurately calculate how many elephants died to provide those six tons of ivory, captured over 25 years, but it may be something like one or two thousand at most. Compare that to the estimated 30,000 elephants that are poached every year. (The Wildlife Conservation Society says that 96 elephants are killed every day.) “That’s 60,000 tusks coming on to the market every year,” Shire says. “So we’re not going to make a dent in that.”

So, if they can’t sell the ivory, and it wouldn’t make a difference if they did, but they keep on seizing it, FWS agents figured they might as well destroy it—and make a big show of it in the process. “These stockpiles of ivory fuel the demand,” said FWS director Dan Ashe at the event last week. But crushing the stockpile in front of a throng of politicians and reporters—that can start a valuable conversation.

The FWS also hopes that the highly-publicized crush will inspire other countries to do the same with their stockpiles, and to start public awareness campaigns there about the impact of the trade. Shire says that this awareness has gradually spread in the U.S. over the decades, but affluent collectors in China and elsewhere have kept the market alive. America, unfortunately, still plays a large role in illegal import and export of ivory, as well.

“We can try to stem the supply through law enforcement, but ultimately, you really have to find a way to reduce the demand, and that’s probably going to be done through education,” Shire says. “There are still huge misconceptions in some parts of the world that elephants are somehow anesthetized and their tusks are cut off and then they regrow, or that they fall out naturally. But elephants are killed horrifically and mutilated for people to get their tusks.”

To that end, the FWS has plans to build the pulverized ivory pieces and dust into educational displays and place them in museums and zoos. The FWS hopes that the displays will act as memorials to elephants lost, and that they will help spark conversation about the true cost of ivory.