The Economic Value of Biodiversity Preservation
Material type:
- 1573-1502
Item type | Current library | Vol info | Status | Barcode | |
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Dr VKRV Rao Library | Vol. 87, No. 6 | Not for loan | AI550 |
We study the decision to preserve diverse species when the value of biodiversity is uncertain, or even affected by ambiguity. Optimal decisions are derived both from the perspective of the producer/investor and the policy regulator (ecosystem planner). We find that while calculated risk creates a scope for biodiversity preservation, the presence of ambiguity aversion reduces it, thus accelerating the extinction of species with lower value. Our results suggest that effective conservation strategies would involve a reduction of ambiguity aversion by creating a stable and transparent policy environment. Furthermore, they may involve a two tier strategy, with one tier addressing output targets and the other conservation targets.
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