Is the Endangered Species Act bad for endangered species? John List thinks it might be.

My colleague and co-author John List is one of the most prolific and influential economists around.

He’s got a new working paper with Michael Margolis and Daniel Osgood that makes the surprising claim that the Endangered Species Act — which is designed to help endangered species — may actually harm them.

Why? The key intuition is that after a species is designated as endangered, a decision has to be made about the geographic areas that will be considered critical habitats for that species. An initial set of boundaries is made, after which there are public hearings, and eventually a final decision on what land will be protected. In the meantime, while this debate is ongoing, there are strong incentives for private parties to try to develop land that they may in the future be prevented from developing by the endangered species status. So destruction of habitat is likely to actually increase in the short run.

Based on their theory, they analyze the data for the Cactus Ferruginous Pygmy Owl near Tucson, AZ. Indeed, they find that land development speeds up substantially in the areas that are going to be designated a critical habitats.

This result, combined with Sam Peltzman’s observation that only 39 of the 1,300 species put on the endangered species list have ever been removed, do not paint a very optimistic picture of the efficacy of the Endangered Species Act.


How about introducing a "freezing" period while the debates around the new status of the land last? During that time all the (potential) development will be stopped.


Kirilius, the problem is that one does not have a species instantly qualify or even get considered. What happens is that population studies, EIRs, and other studies happen to pick up on species threat. Before you can decide that it is a real issue, you have to conduct at least some reasonable studies (otherwise, land would be frozen all the time due to some college kid doing a study badly for example). As soon as land owners find out that a study is being conducted, they will trash the land to pre-empt the outcome of freezing. In that way, you end up worse off (you may create a threatened species when none actually turned out to exist). This has been shown to happen in the past (for example, when studies were to be conducted on green-belts, land owners would bulldoze their land to make it worthless for that purpose).




Isn't it just a bad rhetorical trick to say that ESA is "bad" for species? There are many things that have negative short-term consequences. For example, quitting cigarettes has proven quite awful in the short term for most smokers. Using the rhetorical logic above, that would mean that it's bad for a person who smokes to quit smoking. Often a severely dehydrated person will vomit if he drinks too much water. Should we consider water bad for someone who is severely dehydrated?

Spurwing Plover

The ESA should ether be amended or repealed its a unconstitutinal law thats not saving anything but making a bunch of lying eco-freaks rich through stupid lawsuits its robbing farmers and wildlife both


interesting theory, but logical enough that this should have been considered when writing the act


It's simple. Amend the ESA so that no developement can be grandfathered during the time from a species proposal to be listed and the listing.

But the ESA can never be amended. Enviros are too worried that it will gutted insteaded. And it's a really strong law as it stands.

As far as the fact that not many species have been delisted, well that just shows how long it takes to recover species. We humans think that 30 years of the ESA is a long time. It's not!


A few weeks back, Nature had a summary of a paper with similarly weird conclusions about endangered species lists. It explores what it calls the "Anthropogenic Allee Effect"

Here's the abstract from Courchamp, F. et al. PLoS Biol. 4, e415 (2006):

"Standard economic theory predicts that exploitation alone is unlikely to result in species extinction because of the escalating costs of finding the last individuals of a declining species. We argue that the human predisposition to place exaggerated value on rarity fuels disproportionate exploitation of rare species, rendering them even rarer and thus more desirable, ultimately leading them into an extinction vortex."


Another problem with ESA is that it tends to protect "cuter" species over other ones. In other words, animals like wildcats and birds tend to be protected over things like insects.


Surely, John List et al could not publish a paper with the "key intuition" that developers rush out and destroy habitat as fast as they can so as not to be subject to ESA laws.

I mean this is known by everybody who still has a pulse. Most assuredly, econonmists don't publish the obvious, do they? There are some really really neat things to say about the ESA and it's effects if you just think a little harder.


> This result, combined with Sam Peltzman's observation that only 39 of the 1,300 species put on the endangered species list have ever been removed, ...

The problem is that we wait until a population is in really bad shape before they are put on the ESA list. So, recovery time is very long if at all (not enough mating pairs, too much lost habitat, too much loss of prey/food, too many toxins in their environment, etc). Consider the polar bears. If the ESA adds them now, the polar ice caps will not just repair themselves.

The problem of developers trying to destroy the habitat during the pre-listing period is one that is hard to prevent. Even if you add new language, developers and property owners will find out that a species is being looked at well before (during study period), so will have an incentive to pre-emptively destroy the habitat even sooner. Then, just conducting a study could be enough to push a species onto the list due to widespread habitat damage!



Well I think it's correct, but I don't find it very shocking. We talked a lot about this in the economics class I took in high school. It is nice to see actual supporting data is being published though.


The theory fits very well in the case of Western Ghats in south India. For example the famous "Silent Valley" ever green rain forest in Western ghats.There the State Government wanted to construct a Hydel project and the State Electricity Board destroyed considerable forest area until the then Prime Minister Mrs.Gandhi iterfered and declared it as a National Park.Many private parties vigorously undertake land development when some forest area is earmarked for the protection of endangered species.It is the vested interests like the forest mafia( sandal wood, ganja,ivory
etc) and forest land encroachers who create real threats for the endangered species and not the endangered species themselves.


But wasn't the beauty of Freakonomics that it told us things that were counter intuitive, such as that the most honorable people (sumo) in the most honorable society (Japan) could be crooks.

But isn't this post just the opposite? Just someone unfamiliar with environmental issues publishing "data" that proves the obvious.

I don't buy it. I think it's lazy.


We have a saying where I am from.....the 3 S's. Shoot it, shovel it, and shutup. The ESA has alienated the very people who could do the most for these animals


For a discovery to have validity, we need at least a sample of 30 observations. The Cactus Ferruginous Pygmy Owl is one observations. So, you are still 29 short of being able to say anything with statistical validity.
What you have, gentlemen, is not a trend. It's an observation.

To egretman;
For a matter to be counterintuitive, it has to have two different components. One intuitive, and one that's .... yup, counter-intuitive. The fact, that the gready are exactly that is (as you've guessed) the intuitive part. That the ESA is actually bad for the endangered species is the counter-intuitive component.


Charles C. Mann wrote a article many years ago in the Atlantic Monthly pointing out that landowners have an incentive to quietly exterminate any endangered species they find on their land.

Of course, it's also true that many endangered species aren't really endangered. It's just that nobody bothered looking for them until a development was announced. At that point, opponents of the real estate development hire naturalists to find little known species on the property. It's often easier to find some supposedly rare species on a piece of land than for the developers to find that particular species in enough places elsewhere to show it isn't rare.

Although the public tends to visualize every endangered species as panda bears or whooping cranes, weeds are particularly useful to anti-developers, since their geographic spread is often poorly known because who cares about weeds? Thus it's easier to portray them as endangered.

For example, the discovery of the San Fernando Spineflower, a tiny weed almost indistinguisable from the San Gabriel Spineflower, helped derail development of the billion dollar Ahmanson Ranch project outside of Los Angeles.



"I mean this is known by everybody who still has a pulse. Most assuredly, econonmists don't publish the obvious, do they? There are some really really neat things to say about the ESA and it's effects if you just think a little harder."

So go ahead and say them.


Actually, habitat destruction will continue (albiet at a slower pace) even if the ESA is not activated for that area. But the destruction will continue for a longer time. At least with the ESA the habitat will be protected afterwords.


The fact, that the gready (sic) are exactly that is (as you've guessed) the intuitive part. That the ESA is actually bad for the endangered species is the counter-intuitive component.


The latter is a stupid conclusion based upon the former intuitive part. It's not counter intuitive at all. It's stupid because it's obvious. And known to every one in the field.

Obvious is never counter intuitive.