Abstract
The point of departure for this paper is the familiar prototype fisheriesmodel where a fictitious sole owner harvests a fish population to maximizepresent discounted profits. The paper answers analytically the followingquestion. ``What happens to a policy when the sole owner also valuesbiodiversity, as well as profits?'' It turns out that the size of the steady-state stock and the number of species preserved are both higher, whenspecies diversity is positively valued. This paper provides a sharpcharacterization of the optimal policy in terms of the usual economicparameters and an exogenously introduced willingness-to-pay function forspecies preservation.
Similar content being viewed by others
REFERENCES
Clark, C. W. (1990), Mathematical Bioeconomics: The Optimal Management of Renewable Resources (2nd edition). New York: John Wiley & Sons.
Cropper, M. (1976), ‘Regulating Activities with Catastrohic Effects’, Journal of Environmental Economics and Management 3, 1–15.
Holling, C. S., D. W. Schindler, B. W. Walker and J. Roughgarden (1995), ‘Biodiversity in the Functioning of Ecosystems: An Ecological Synthesis’, in C. Perrings, ed., Biodiversity Loss — Economic and Ecological Issues. Cambridge: Cambridge University Press.
Li, C. Z. and K. G. Löfgren (1998), ‘A Dynamic Model of Biodiversity Preservation: Theory and Applications’, Environment and Development Economics 3, 157–172.
Spence, M. and D. Starrett (1975), ‘Most Rapid Approach Paths in Accumulation Problems’, International Economic Review 16, 388–403.
Author information
Authors and Affiliations
Rights and permissions
About this article
Cite this article
Li, CZ., Löfgren, KG. & Weitzman, M.L. Harvesting versus Biodiversity: An Occam's Razor Version. Environmental and Resource Economics 18, 355–366 (2001). https://doi.org/10.1023/A:1011184509459
Issue Date:
DOI: https://doi.org/10.1023/A:1011184509459