On the Consumer Value of Environmental Diversity

Abstract

This paper develops a methodology for the valuation of the taste for diversity. The concerns about the contribution of diversity in the valuation of consumer goods typically arise when it is believed that the total value is The methodology we propose infers the economic value of diversity through fish market price by using a system of inverse demands to model the nature of this particular commodity. We develop our analysis of the consumer value of diversity using Luenberger’s benefit function (Luenberger, 1992). In this context, we show that the benefit function provides a conceptual framework to conduct a welfare analysis of the value of diversity in a system framework.