Killing the Golden Goose? Tourism and Deforestation in Nepal

Abstract

This paper analyzes economic forces in Nepal's tourism market. Market actors' utility maximization results in inefficient supply and demand outcomes and unsustainable ecotourism. This result is in direct contradiction to the stated goals of the actors, but predictable in the context of the tourism market structure. Proposed solutions include improved property rights and a change in government objectives.

Keywords: ecotourism, externalities, property rights, corruption, national parks, international aid, Nepal

JEL Classification: D23, D45, D73