PubData Leuphana Repository: Natural vs. financial insurance in the management of public-good ecosystems

Please use this identifier to cite or link to this item: https://doi.org/10.48548/pubdata-1222

Resource type	Working Paper
Title(s)	Natural vs. financial insurance in the management of public-good ecosystems
DOI	10.48548/pubdata-1222
Handle	20.500.14123/1285
Creator	Quaas, Martin F. 0000-0003-0812-8829 Baumgärtner, Stefan 0000-0001-8314-8462 121846857
Abstract	In the face of uncertainty, ecosystems can provide natural insurance to risk averse users of ecosystem services. We employ a conceptual ecological-economic model to analyze the allocation of (endogenous) risk and ecosystem quality by risk averse ecosystem managers who have access to financial insurance, and study the implications for individually and socially optimal ecosystem management, and policy design. We show that while an improved access to financial insurance leads to lower ecosystem quality, the effect on the free-rider problem and on welfare is determined by ecosystem properties. We derive conditions on ecosystem functioning under which, if financial insurance becomes more accessible, (i) the extent of optimal regulation increases or decreases; and (ii) welfare, in the absence of environmental regulation, increases or decreases.
Language	English
Keywords	Ecosystem; Risk; Insurance; Ökosystem; Versicherung; Haftpflichtrisiko
Year of publication in PubData	2006
Publishing type	First publication
Publication version	Published version
Date issued	2006-11-22
Creation context	Research
Published by	Medien- und Informationszentrum, Leuphana Universität Lüneburg
Related resources	Relations of this publication Relations of this publication