The Impact of Information on Land Development: A Dynamic and Stochastic Analysis
Amitrajeet Batabyal ()
Working Papers from Utah State University, Department of Economics
In a two-period model, economists such as K.J. Arrow, A.C. Fisher, and C. Henry, have shown that when development is both indivisible and irreversible, a developer who ignores the possibility of obtaining new information about the outcome of such development will invariably underestimate the benefits of preservation and hence favor development. In this note, I extend the AFH analysis in two directions. I model the land development problem in a dynamic framework, explicitly specifying an information production function. In such a setting, I then ask and answer the question concerning when development should take place.
Keywords: development; dynamic; information; uncertainty (search for similar items in EconPapers)
JEL-codes: D82 Q20 (search for similar items in EconPapers)
Pages: 10 pages
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Forthcoming in Journal of Environmental Management
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Working Paper: THE IMPACT OF INFORMATION ON LAND DEVELOPMENT: A DYNAMIC AND STOCHASTIC ANALYSIS (1995)
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Persistent link: https://EconPapers.repec.org/RePEc:usu:wpaper:9513
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