Problems in valuing the benefits of biodiversity protection

Hanley, N. , Spash, C. and Walker, L. (1995) Problems in valuing the benefits of biodiversity protection. Environmental and Resource Economics, 5(3), pp. 249-272. (doi:10.1007/BF00691519)

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Abstract

This paper considers two problems in valuing the benefits of biodiversity protection. These are, firstly, that preferences for biodiversity protection may be lexicographic rather than utilitarian. The more individuals for whom this is true, the less is cost-benefit analysis validated as a means of decision making for biodiversity protection, since lexicographic preferences are incompatible with the Kaldor-Hicks Compensation Test. Secondly, people may be poorly informed about the meaning of biodiversity, complicating the use of contingent valuation as a means of measuring preservation benefits. This paper first discusses the meaning of biodiversity, and trends in diversity over time. We offer some empirical evidence with regard to lexicographic preferences; consider the implications of having poorly-informed consumers; and then report the results of a contingent valuation study of biodiversity protection with varying levels of information. We find that willingness to pay for biodiversity protection increases with the level of information provided.

Item Type:Articles
Status:Published
Refereed:Yes
Glasgow Author(s) Enlighten ID:Hanley, Professor Nicholas
Authors: Hanley, N., Spash, C., and Walker, L.
College/School:College of Medical Veterinary and Life Sciences > Institute of Biodiversity Animal Health and Comparative Medicine
Journal Name:Environmental and Resource Economics
Publisher:Springer
ISSN:0924-6460
ISSN (Online):1573-1502

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