Endangered species, real options, and forest management

摘要: We use a real option approach to determine optimally when social planner has stop or resume logging in situations where an endangered species relies on forest habitat for its survival, and that evolves stochasticly. The model incorporates economic, ecological features, is calibrated generate optimal management rule balances the benefits from commercial exploitation with risks of extinction facing species. For reasonable parameters used our application Rangifer tarandus caribou, Central Labrador (Canada), policy banning temporarily quite attractive as it does not require long periods while drastically reduces risk increases value. Commercially exploiting which home some later’s probability extinction. A ban harvest may prevent such loss but implies foregone revenues. This paper uses theory address issues, Labrador, Canada. While several papers, e.g. [1], options deal biodiversity protection, this one first modelling situation protection decisions affect underlying stochastic process. establishes timber harvesting, allowing it, many times desired help According biologists, known minimum required maintain species; below threshold considered certain. As harvesting affects negatively amount habitat, be reached. decision maker balance against cost increased probability. assume h follows mean-reverting process whose depend forestry regime (harvesting banned, i = b; allowed, a) dht λi (μi − ht) dt + σidzi (1) dzi increment Wiener process, λi, σi ,a ndμi are respectively speed reversion, volatility equilibrium long-run μi. Suppose banned if level caribou diminishes ∗ , presumably lower than longrun virgin μb higher μe. One way assess impact compare Pb(h ; he ,μ b) reach once same event without Pa(h b). Pb(h; b), Pb(h) short, ecosystem ”recover” harvesting. Indeed, reaches undisturbed free any negative previous still occur after despite natural. Pi(h) can shown satisfy following differential equation