Valuation of Biodiversity for Use in New Product Research in a Model of Sequential Search

R. David Simpson and Roger A. Sedjo

No 10618, Discussion Papers from Resources for the Future

Abstract: We develop a model of search in which a researcher chooses the size of sequential batches of samples to test. While earlier work has considered similar questions, the contribution of this paper is to use the search model to place a value on the marginal research opportunity. The valuation of such opportunities may be of little interest or relevance in many of the contexts in which search models are employed, but we apply our analysis to an area of considerable societal interest: the valuation of biological diversity for use in new product research. While data from which to make inferences are limited, we find that, using plausible estimates of relevant parameters, the value of biodiversity in these applications is negligible.

Keywords: Environmental; Economics; and; Policy (search for similar items in EconPapers)
Pages: 46
Date: 1996
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Citations: View citations in EconPapers (8)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:rffdps:10618

DOI: 10.22004/ag.econ.10618

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