The Economics of The Illegal Ivory Trade
Elephants are currently in the midst of a huge crisis. Every year, approximately 35,000 (of the current 500,000) are killed, largely to supply the illegal international trade in ivory and to meet demand in Asia- primarily China. If this rate of killing continues, it is estimated that African elephants will no doubt become extinct within the next ten years.
Ivory has been a traded commodity since at least Old Testament times- when King Solomon’s ships brought back ivory from Africa. Ivory exports from Africa had increased by 400% between 1850 and 1875, but losses in West Africa were particularly high- with the region later becoming known as the Ivory Coast. As human population expanded during the 20th century, elephants were increasingly restricted to protected areas. Between 1981 and 1987, population size of the African elephant was suspected to have decreased by more than half.
Why is that this elephant ivory has been given such a high value in the market in the first place? For many consumers, ivory is a multi-purpose good which also has high aesthetic appeal.
The largest of the traders and consumers of ivory are China and the USA, with China in particular having had ivory as part of the traditional culture.
Wildlife experts estimate that approximately 70 percent of global ivory ends up in China where it is seen as a precious material and is used in various ornaments and jewelry. It is also often a key ingredient in traditional Chinese medicine and is seen as a sign of wealth and good fortune.
In other parts of the world, ivory has acquired a status similar to many precious metals, resulting in it being given a high monetary value. As a result, a single elephants ivory can often be worth as much as $150,000- $300,000, thus explaining the immense incentives behind the poaching of these animals.
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