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Balancing conservation and commerce: A shadow value viability approach for governing bycatch

Pierce Donovan and Michael Springborn

Journal of Environmental Economics and Management, 2022, vol. 114, issue C

Abstract: The losses from extinction events are not well-known, making an expected net benefits approach to conservation problems difficult to implement. A viable control strategy instead focuses on limiting the risk of extinction to some acceptably low level at the least possible cost. Here we describe a shadow value viability approach for solving conservation problems with irreversible thresholds with dynamic programming. A social planner calculates the minimal (virtual) level of loss from extinction that would trigger sufficient action to avoid extinction with the desired confidence. The cost-effective policy then arises from acting as if the resulting shadow value is real. We demonstrate the method in a numerical application to the conservation of the Pacific leatherback turtle population, which co-mingles with the Pacific swordfish fishery. We show how the cost-effective outcome can be achieved among decentralized fishers by using the planner’s shadow value to set market-based instruments for managing turtle bycatch. This approach translates the species viability objective into economic terms so conservation and commercial harvest can be rationally integrated.

Keywords: Viable control; Dynamic programming methods; Shadow valuation; Catastrophes; Thresholds; Bioeconomics; Conservation; Bycatch; Market-based instruments; Multi-species fisheries management (search for similar items in EconPapers)
JEL-codes: C6 Q2 Q5 (search for similar items in EconPapers)
Date: 2022
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DOI: 10.1016/j.jeem.2022.102689

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Journal of Environmental Economics and Management is currently edited by M.A. Cole, A. Lange, D.J. Phaneuf, D. Popp, M.J. Roberts, M.D. Smith, C. Timmins, Q. Weninger and A.J. Yates

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