Biodiversity and local asset values

Jess Cornaggia, Yu-Hsuan (Jennifer) Liang, Peter Iliev and Qiang Wang

Review of Finance, 2026, vol. 30, issue 1, 391-421

Abstract: We provide a national-scale benchmark on how biodiversity is priced in local assets in the United States. Property prices increase with local biodiversity loss, likely reflecting development-driven monetization. In contrast, at the regional level, greater species richness correlates with higher asset values, indicating that remaining regional biodiversity is viewed as an amenity. Over time, the premium from biodiversity loss weakens, while the valuation of regional biodiversity strengthens. The link between biodiversity and property prices is higher when public attention to biodiversity is high. Together, these results highlight a shift in market preferences: biodiversity is increasingly recognized and priced as natural capital since the turn of the century. This evidence shows how ecological conditions are capitalized into local asset values and highlights implications for conservation policy and sustainable land use.

Keywords: biodiversity; species richness; natural capital; real estate; sustainable finance; habitat fragmentation (search for similar items in EconPapers)
JEL-codes: G1 N5 Q1 Q2 Q3 Q5 R1 R3 (search for similar items in EconPapers)
Date: 2026
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