Endangered species, real options, and forest management

@inproceedings{Abdallah2007EndangeredSR,
  title={Endangered species, real options, and forest management},
  author={Skander Ben Abdallah and Pierre Lasserre},
  year={2007}
}
We use a real option approach to determine optimally when a social planner has to stop or resume logging in situations where an endangered species relies on forest habitat for its survival, and that habitat evolves stochasticly. The model incorporates economic, ecological and social features, and is calibrated to generate an optimal forest management rule that balances the benefits from commercial forest exploitation with the risks of extinction facing the endangered species. For the reasonable… CONTINUE READING