Valuing Biodiversity from an Economic Perspective: AUnified Economic, Ecological and Genetic Approach

William Brock and Anastasios Xepapadeas

No 301, Working Papers from University of Crete, Department of Economics

Abstract: We develop a conceptual framework for valuing biodiversity from an economic perspective. We consider biodiversity important because of a number of characteristics or services that it provides or enhances. We argue for a dynamic economic welfare measure of biodiversity that complements the existing literature on benefit-cost approaches and genetic distance/phylogenic tree approaches, which to date have been more static. Using a unified model of optimal economic management of an ecosystem under ecological and genetic constraints, we identify gains realized by management policies leading to a more diverse system, using the Bellman state valuation function of the problem. We show that a more diverse system could attain a higher value even though the genetic distance of the species in the more diverse system could be almost zero. We relate this endogenous measure of the biodiversity value to ecologically/biologically oriented biodiversity metrics (species richness, Shannon or Simpson indices).

Pages: 38 pages
New Economics Papers: this item is included in nep-agr, nep-env and nep-res
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Citations: View citations in EconPapers (68)

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Related works:
Journal Article: Valuing Biodiversity from an Economic Perspective: A Unified Economic, Ecological, and Genetic Approach (2003)
Working Paper: Valuing biodiversity from an economic perspective: a unified economic, ecological and genetic approach (2003)
Working Paper: Valuing biodiversity from an economic perspective: a unified economic, ecological and genetic approach (2001)
Working Paper: Valuing Biodiversity from an Economic Perspective: A Unified Economic, Ecological and Genetic Approach (2001)
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