Discussion Papers, Department of Business and Management Science, Norwegian School of Economics (NHH)
Sturla Furunes Kvamsdal
A Market-Based Approach to Manage Endangered Species Interactions
() and Stephen M. Stohs
Abstract: An economic activity interacts with an endangered species.
The activity can be divided into mutually exclusive strata with different
levels of interaction. Observing the activity in order to monitor
interactions is costly. It may be desirable to manage the activity with a
probability model which balances the benefit from the activity against the
cost of the interaction with the endangered specie instead. The model gives
rise to a permit scheme which fixates the risk of interaction over all
strata and which uses the market mechanism to optimally allocate the
activity between strata. The model can facilitate uncertainty in
interaction rate estimates.
Keywords: Endangered species interactions; permit scheme; probability model; (follow links to similar papers)
JEL-Codes: Q50; (follow links to similar papers)
18 pages, September 10, 2010
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