Value of Improved Information about Forest Protection Values, with Application to Rainforest Valuation
What is the utility from obtaining more precise values of natural resource objects (rainforests), through surveys or other similar information gathering? In the value of information problems studied here, a principal who wishes to preserve a resour...
| Main Authors: | , |
|---|---|
| Format: | Working Paper |
| Language: | English en_US |
| Published: |
World Bank, Washington, DC
2015
|
| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/2015/09/25093627/value-improved-information-forest-protection-values-application-rainforest-valuation http://hdl.handle.net/10986/22846 |
| id |
okr-10986-22846 |
|---|---|
| recordtype |
oai_dc |
| spelling |
okr-10986-228462021-04-23T14:04:11Z Value of Improved Information about Forest Protection Values, with Application to Rainforest Valuation Strand, Jon Siddiqui, Sauleh PURCHASE PRICE RISKS PRODUCTION VALUATION CARBON INTEREST EXPECTATIONS AGRICULTURAL PRODUCTION OBJECTS RESOURCE MANAGEMENT INFORMATION RESOURCE ALLOCATION TIMBER EMISSIONS WELFARE GROSS VALUE EFFECTS DISTRIBUTION VARIABLES ASYMMETRIC INFORMATION UTILITY VALUE INFORMATION ANALYSES DECISIONS PAYMENTS PROBABILITIES CDF WILLINGNESS TO PAY KNOWLEDGE INFLUENCE MATHEMATICS DOCUMENT DOMAIN RENT PROBABILITY IMPERFECT INFORMATION TRANSFERS CASES CARBON TAXES MARKETS ORGANIZATIONS WTP EXPECTED VALUES ECONOMICS LITERATURE BENEFIT ANALYSIS RESEARCH ENVIRONMENTAL ECONOMICS NATURAL RESOURCES UTILITY CLASSIFICATION CONTINGENT VALUATION EFFICIENCY PRIVATE INFORMATION TAXES RESOURCES EQUITY ENVIRONMENTAL VALUATION RISK NEUTRAL OPPORTUNITY COST CLIMATE CHANGE POLICIES VALUES ECONOMIC RESOURCES VALUE DEFORESTATION ABATEMENT UTILITY FUNCTION INEFFICIENCY EXPECTED VALUE EXPENDITURES AGRICULTURE PROPERTY DECISION MAKING INFORMATION ANALYSIS MEASUREMENT ENVIRONMENT BENCHMARK ECONOMIC THEORY ECONOMICS CASE MANAGEMENT TRADE LAND THEORY OBJECT EXPECTED UTILITY RISK INFORMATION MODEL BARGAINING SUPPLY OPTIMAL ALLOCATION GAME THEORY RISK MANAGEMENT STANDARD ECONOMISTS PERFECT INFORMATION CONCEPTS ENVIRONMENTAL OUTCOMES NATURAL RESOURCE ECONOMICS AGRICULTURAL USES DEVELOPMENT POLICY FUTURE RESEARCH What is the utility from obtaining more precise values of natural resource objects (rainforests), through surveys or other similar information gathering? In the value of information problems studied here, a principal who wishes to preserve a resource sets a price to offer to a seller without knowing precisely the protection value or opportunity value, to the seller. The value of information related to more precise information about the protection value for the principal is a key issue in environmental and natural resource valuation, but it is in most cases implicit and not analyzed. More precise resource values reduce the frequency of two types of mistakes (saving the resource when it should not be saved, and not saving the resource when it should be saved), and increases the principal’s ex ante expected utility value. This paper applies the model to Amazon rainforest protection and considers the hypothetical value of perfect information. The analysis finds that the value of perfect information can easily exceed realistic information costs, thus perhaps justifying significant expenditures for valuation studies, given that all available information is used efficiently for conservation decision purposes. The value of perfect information also depends on the nature of buyer-seller interactions, and is higher in the altruistic case, where the principal has full concern for the outcome for the seller. 2015-11-04T22:10:20Z 2015-11-04T22:10:20Z 2015-09 Working Paper http://documents.worldbank.org/curated/en/2015/09/25093627/value-improved-information-forest-protection-values-application-rainforest-valuation http://hdl.handle.net/10986/22846 English en_US Policy Research Working Paper;No. 7423 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank World Bank, Washington, DC Publications & Research :: Policy Research Working Paper Publications & Research Brazil |
| repository_type |
Digital Repository |
| institution_category |
Foreign Institution |
| institution |
Digital Repositories |
| building |
World Bank Open Knowledge Repository |
| collection |
World Bank |
| language |
English en_US |
| topic |
PURCHASE PRICE RISKS PRODUCTION VALUATION CARBON INTEREST EXPECTATIONS AGRICULTURAL PRODUCTION OBJECTS RESOURCE MANAGEMENT INFORMATION RESOURCE ALLOCATION TIMBER EMISSIONS WELFARE GROSS VALUE EFFECTS DISTRIBUTION VARIABLES ASYMMETRIC INFORMATION UTILITY VALUE INFORMATION ANALYSES DECISIONS PAYMENTS PROBABILITIES CDF WILLINGNESS TO PAY KNOWLEDGE INFLUENCE MATHEMATICS DOCUMENT DOMAIN RENT PROBABILITY IMPERFECT INFORMATION TRANSFERS CASES CARBON TAXES MARKETS ORGANIZATIONS WTP EXPECTED VALUES ECONOMICS LITERATURE BENEFIT ANALYSIS RESEARCH ENVIRONMENTAL ECONOMICS NATURAL RESOURCES UTILITY CLASSIFICATION CONTINGENT VALUATION EFFICIENCY PRIVATE INFORMATION TAXES RESOURCES EQUITY ENVIRONMENTAL VALUATION RISK NEUTRAL OPPORTUNITY COST CLIMATE CHANGE POLICIES VALUES ECONOMIC RESOURCES VALUE DEFORESTATION ABATEMENT UTILITY FUNCTION INEFFICIENCY EXPECTED VALUE EXPENDITURES AGRICULTURE PROPERTY DECISION MAKING INFORMATION ANALYSIS MEASUREMENT ENVIRONMENT BENCHMARK ECONOMIC THEORY ECONOMICS CASE MANAGEMENT TRADE LAND THEORY OBJECT EXPECTED UTILITY RISK INFORMATION MODEL BARGAINING SUPPLY OPTIMAL ALLOCATION GAME THEORY RISK MANAGEMENT STANDARD ECONOMISTS PERFECT INFORMATION CONCEPTS ENVIRONMENTAL OUTCOMES NATURAL RESOURCE ECONOMICS AGRICULTURAL USES DEVELOPMENT POLICY FUTURE RESEARCH |
| spellingShingle |
PURCHASE PRICE RISKS PRODUCTION VALUATION CARBON INTEREST EXPECTATIONS AGRICULTURAL PRODUCTION OBJECTS RESOURCE MANAGEMENT INFORMATION RESOURCE ALLOCATION TIMBER EMISSIONS WELFARE GROSS VALUE EFFECTS DISTRIBUTION VARIABLES ASYMMETRIC INFORMATION UTILITY VALUE INFORMATION ANALYSES DECISIONS PAYMENTS PROBABILITIES CDF WILLINGNESS TO PAY KNOWLEDGE INFLUENCE MATHEMATICS DOCUMENT DOMAIN RENT PROBABILITY IMPERFECT INFORMATION TRANSFERS CASES CARBON TAXES MARKETS ORGANIZATIONS WTP EXPECTED VALUES ECONOMICS LITERATURE BENEFIT ANALYSIS RESEARCH ENVIRONMENTAL ECONOMICS NATURAL RESOURCES UTILITY CLASSIFICATION CONTINGENT VALUATION EFFICIENCY PRIVATE INFORMATION TAXES RESOURCES EQUITY ENVIRONMENTAL VALUATION RISK NEUTRAL OPPORTUNITY COST CLIMATE CHANGE POLICIES VALUES ECONOMIC RESOURCES VALUE DEFORESTATION ABATEMENT UTILITY FUNCTION INEFFICIENCY EXPECTED VALUE EXPENDITURES AGRICULTURE PROPERTY DECISION MAKING INFORMATION ANALYSIS MEASUREMENT ENVIRONMENT BENCHMARK ECONOMIC THEORY ECONOMICS CASE MANAGEMENT TRADE LAND THEORY OBJECT EXPECTED UTILITY RISK INFORMATION MODEL BARGAINING SUPPLY OPTIMAL ALLOCATION GAME THEORY RISK MANAGEMENT STANDARD ECONOMISTS PERFECT INFORMATION CONCEPTS ENVIRONMENTAL OUTCOMES NATURAL RESOURCE ECONOMICS AGRICULTURAL USES DEVELOPMENT POLICY FUTURE RESEARCH Strand, Jon Siddiqui, Sauleh Value of Improved Information about Forest Protection Values, with Application to Rainforest Valuation |
| geographic_facet |
Brazil |
| relation |
Policy Research Working Paper;No. 7423 |
| description |
What is the utility from obtaining more
precise values of natural resource objects (rainforests),
through surveys or other similar information gathering? In
the value of information problems studied here, a principal
who wishes to preserve a resource sets a price to offer to a
seller without knowing precisely the protection value or
opportunity value, to the seller. The value of information
related to more precise information about the protection
value for the principal is a key issue in environmental and
natural resource valuation, but it is in most cases implicit
and not analyzed. More precise resource values reduce the
frequency of two types of mistakes (saving the resource when
it should not be saved, and not saving the resource when it
should be saved), and increases the principal’s ex ante
expected utility value. This paper applies the model to
Amazon rainforest protection and considers the hypothetical
value of perfect information. The analysis finds that the
value of perfect information can easily exceed realistic
information costs, thus perhaps justifying significant
expenditures for valuation studies, given that all available
information is used efficiently for conservation decision
purposes. The value of perfect information also depends on
the nature of buyer-seller interactions, and is higher in
the altruistic case, where the principal has full concern
for the outcome for the seller. |
| format |
Working Paper |
| author |
Strand, Jon Siddiqui, Sauleh |
| author_facet |
Strand, Jon Siddiqui, Sauleh |
| author_sort |
Strand, Jon |
| title |
Value of Improved Information about Forest Protection Values, with Application to Rainforest Valuation |
| title_short |
Value of Improved Information about Forest Protection Values, with Application to Rainforest Valuation |
| title_full |
Value of Improved Information about Forest Protection Values, with Application to Rainforest Valuation |
| title_fullStr |
Value of Improved Information about Forest Protection Values, with Application to Rainforest Valuation |
| title_full_unstemmed |
Value of Improved Information about Forest Protection Values, with Application to Rainforest Valuation |
| title_sort |
value of improved information about forest protection values, with application to rainforest valuation |
| publisher |
World Bank, Washington, DC |
| publishDate |
2015 |
| url |
http://documents.worldbank.org/curated/en/2015/09/25093627/value-improved-information-forest-protection-values-application-rainforest-valuation http://hdl.handle.net/10986/22846 |
| _version_ |
1764452215208017920 |