Coral reefs are one of the most complex ecosystems on earth. With over 4,000 different species of fish, 700 species of coral and countless other plants and animals they are often called "rainforests of the sea". Their beauty and wealth of biodiversity provide tangible and intangible benefits for millions of people worldwide. However, it's mainly the livelihood of coastal communities that relies on the reefs as a major source of income from fishing and tourism and as a protection from the forces of the sea. These benefits are increasingly at risk: Costal development, destructive fishing practices, pollution, sedimentation and most recently ocean warming have been identified as factors contributing to a continuous decline of coral reef health. In order to halt degradation there is a need to understand the causal mechanisms and to develop strategies that could address the driving forces at local, national and global levels. 1 Economists, up to now, have contributed to this knowledge mainly by estimating the economic value of coral reefs (e.g. Cesar 1996) and pointing out the importance of community involvement in coral reef management (e.g. White and Vogt 2000).This book by Aceng Hidayat contributes to the latter line of research by analyzing coral reef management in Indonesia from an institutional point of view. Indonesia as the largest archipelago country in the world holds about 18 percent of the worlds' coral reef ecosystems, which - being no exception from the rule - have degraded increasingly. Aceng Hidayat questions, however, the conventional interpretation of the causes. Saying that pollution or destructive fishing practices cause reef degradation would touch merely the surface of the problem. Instead, Aceng Hidayat argues that the problem is more deeply rooted in the underlying institutional structure of coral reef management. Studying Indonesian history, he identifies a combination of conflicting property rights, contradicting sectoral policies and the inability of the state and its agencies to enforce their property claims as main reason for economic activities that led to degradation of coral reefs. As in many other cases, unclear property rights and inconsistent public policy is likely to create a vacuum where state property turns into open access with its well-known negative consequences for sustainable resource use. The question then arises if property rights or governance structures should change to enhance sustainable resource use. Aceng Hidayat reveals that this actually has happened in Indonesia where costal resource management was decentralized in 1999 and where since then local governance structures have developed supporting sustainable coral reef management.Aceng Hidayat analyzes this institutional change in Indonesia by means of the case study of Gili Indah village in West Lombok, using the analytical frameworks of Ostrom (1990) and Hagedorn et al. (2002). The latter explains the development of property rights and governance structures for sustainable resource use as influenced by the actors and their transactions. Over time, changing actor constellations or changing transactions may lead to institutional innovation and adjustments of property rights and governance structures that rule the sustainability of resource use. In Gili Indah village, Aceng Hidayat identifies fishermen, tourist business, nature protection agency, and village administration as the most important actors, and fishing and tourism as the two main activities that show different but interrelated transactions. For centuries, coral reefs were managed as an open access resource and subsistence fishing was the main source of the livelihood of costal communities. The commercialization of fishing and the rise of destructive fishing practice since 1958 has endangered many fish species and damaged the coral reefs. When in 1978 the local tourist industry began to develop, livelihood strategies of the villagers started to change as well, leading to conflicts with the existing fishing practice. In 1993, the Indonesian government declared the area a conservation zone to protect coral reefs and to support the development of the tourist industry. However, the government agencies were unable to enforce the conservation regulations. This changed in 1999 when the management of natural resources was decentralized and local institutions, the so-called awig-awig, developed for coral reef management too. Driving force of that institutional change and its effective enforcement at local level has been the local tourist industry.This case study by Aceng Hidayat contributes to the knowledge of how to protect coral reefs in two ways: First, it illustrates that institutions of sustainability can only become effective when they are supported by adequate governance structures. Governance structures are, however, linked with property rights that influence legitimacy and incentives. There are good arguments that local actors that are mostly affected by coral reef degradation should have ownership of the rules of resource use so that they would have an incentive to effectively monitor and control it. Second, the case shows that the tourist industry is a key actor of the coral reef ecosystem protection due to its strong economic interest in the resource system. Tourism obviously is able to create a win-win association between protected areas and local communities, that fosters the support for nature protection (see also de Oliveira 2002). The development of tourism seems therefore essential for coral reef protection. Whether or not this outcome can be generalized must be left to further research that should particularly investigate the role of the tourist industry for the development of property rights and governance structures for natural resources.Volker Beckmann and Konrad Hagedorn