The institutional economics of biodiversity, biological materials, and bioprospecting

This paper analyzes the fundamental economic and institutional issues connected with biodiversity, biological materials, and bioprospecting. The main findings are that biodiversity and biological materials are common pool goods and must be governed accordingly; research and development using biological materials is a dynamic, inter-temporal asset transformation process that has a mixed economic nature, which requires equally diverse and dynamic governance rules and processes; in general, bioprospecting is best governed by relationship contracting principals that are designed to fit specific economic and institutional conditions. However, there are no blueprints for access and benefit sharing: in addition to extensive consultations with a wide range of stakeholders, developing appropriate policy and regulatory solutions requires detailed empirical analyses of specific asset transformation processes in particular technological, cultural, and institutional settings.