Abstract

This paper develops a dynamic model for cost-effective selection of sites for restoring biodiversity when habitat quality develops over time and is uncertain. A safety-first decision criterion is used for ensuring a minimum level of habitats, and this is formulated in a chance-constrained programming framework. The theoretical results show; (i) inclusion of quality growth reduces overall cost for achieving a future biodiversity target from relatively early establishment of habitats, but (ii) consideration of uncertainty in growth increases total cost and delays establishment, and (iii) cost-effective trading of habitat requires exchange rate between sites that varies over time. An empirical application to the red listed umbrella species - white-backed woodpecker - shows that the total cost of achieving habitat targets specified in the Swedish recovery plan is doubled if the target is to be achieved with high reliability, and that equilibrating price on a habitat trading market differs considerably between different quality growth combinations. (C) 2013 Department of Forest Economics, Swedish University of Agricultural Sciences, Umea. Published by Elsevier GmbH. All rights reserved.

Keywords

Cost-effective biodiversity restoration; Uncertainty; Spatial and temporal heterogeneity; Chance constrained programming; White-backed woodpecker in Sweden

Published in

Journal of Forest Economics
2014, Volume: 20, number: 1, pages: 77-92
Publisher: Elsevier

SLU Authors

• Gren, Ing-Marie

  • Department of Economics, Swedish University of Agricultural Sciences
    

• Mikusinski, Grzegorz

  • Department of Ecology, Swedish University of Agricultural Sciences
    

UKÄ Subject classification

Economics


Publication identifier

DOI: https://doi.org/10.1016/j.jfe.2013.09.003

Permanent link to this page (URI)

https://res.slu.se/id/publ/60566