Implementing efficient conservation portfolio design

Mindy Mallory () and Amy Ando

Resource and Energy Economics, 2014, vol. 38, issue C, 1-18

Abstract: Modern tools for cost-effective conservation reserve site planning require the planner to have information about spatial distributions of conservation costs and benefits. Climate change creates unprecedented uncertainty about future land values and species habitat ranges, such that conservation scientists cannot map costs and benefits with certainty anymore. This paper contributes to the literature on the economics of conservation in the face of climate change uncertainty. It advances a new method for using modern portfolio theory to choose lands to protect that yield total conservation returns with less uncertainty. It explores the implications for portfolio recommendations of variation in the correlations between ecological and land-value responses to climate change. It also tests the robustness of the method to shortcuts that might be taken to simplify analysis, identifying problems that arise if conservation costs are ignored in portfolio analysis and demonstrating when portfolio recommendations are sensitive to how ecological benefits are quantified.

Keywords: Conservation; Reserve-site selection; Climate change; Uncertainty; Portfolio; Risk; Spatial; Prairie Pothole Region (search for similar items in EconPapers)
JEL-codes: Q15 Q2 Q20 Q24 Q54 Q57 (search for similar items in EconPapers)
Date: 2014
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (14)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:resene:v:38:y:2014:i:c:p:1-18

DOI: 10.1016/j.reseneeco.2014.05.001

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