Working PaperFirst publicationPublished version DOI: 10.48548/pubdata-1949 Handle: 20.500.14123/10174

The economic insurance value of ecosystem resilience

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Chronological data

Date of first publication2009-07
Date of publication in PubData 2025-07-29

Language of the resource

English

Related external resources

Part of ISSN: 1860-5508
Working Paper Series in Economics

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Abstract

Ecosystem resilience, i.e. an ecosystem’s ability to maintain its basic functions and controls under disturbances, is often interpreted as insurance: by decreasing the probability of future drops in the provision of ecosystem services, resilience insures risk-averse ecosystem users against potential welfare losses. Using a general and stringent definition of “insurance” and a simple ecological-economic model, we derive the economic insurance value of ecosystem resilience and study how it depends on ecosystem properties, economic context, and the ecosystem user’s risk preferences. We show that (i) the insurance value of resilience is negative (positive) for low (high) levels of resilience, (ii) it increases with the level of resilience, and (iii) it is one additive component of the total economic value of resilience.

Keywords

Ecosystem; Economic Value; Resilience; Insurance

Number of the series contribution

132

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DDC

330 :: Wirtschaft

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Research