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The relevance of monetary valuations of biodiversity for public decision makers

Doctoral thesis in Economics, Ph.D. supervisor Alain Ayong Le Kama, University Lille 1
Loraine Roy

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1There is a profusion of research on environmental monetary valuation methods, and particularly in ‘biodiversity valuations’ because biodiversity losses have become one of the two environmental iconic problems of the 2010s with climate change (Zaccai, 2012). Often, it is the neoclassical/welfare theory of the economic value and environmental asset valuation that is applied to value biodiversity. However, this theory raises many concerns, by itself, but also regarding its applicability to biodiversity. We can schematically categorize those concerns as ethical, technical, pragmatic and policy relevance concerns (Scherrer, 2004) ; and so valuations studies have focused on those concerns via empirical cases or theoretical studies, highlighting the pros and cons of different valuations methods or of the overall monetary valuation approach to biodiversity. However, there is still a lack of conceptual thinking about the nature of biodiversity as an economic object, i.e. its economic status, and about the appropriate conditions of use of monetary values. This PhD tries therefore to deal with the fundamental conceptual principles of the mainstream theory of monetary valuation, and with the notion of biodiversity, in order to identify the type of information that monetary valuations of biodiversity can and cannot bring, but also should and should not attempt to bring to public decision makers.

2To be more precise, we first (1st article) review the roles that monetary valuations of biodiversity are expected to play, according to the literature (pragmatic concern). We notice that actually, not only valuations are expected to play a role of support for decision-making and management, but they are also expected to be informing, sensitizing and convincing, which may undermine the instrumental and supposedly neutral role of valuations. We also realize that two major dimensions of valuations (or valuations uses) are recurrently evoked, either for the promotion of the relevance of valuations or for the criticism of such promotion and relevance. One is the recourse to the monetary unit ; the second is the use of valuations in Cost-Benefit Analysis (CBA). We explore those two dimensions with an interdisciplinary approach.

3We then explore the ethical approach of monetary valuations. We discuss the ethical approach of economics itself to then deduce the ethical and conceptual shift that valuing monetarily an object, in addition to study it economically, can bring. We conclude that economics is anthropocentric (strongly or weakly) and instrumental (or merely instrumental) and that the particular approach of valuing monetarily biodiversity often tended to transform the economic approach to biodiversity into a strongly anthropocentric and merely instrumental approach. This implies that the recourse to monetary valuations for valuing existence value, but also other non-use values and experience-value may be inappropriate or at least provide an incomplete picture of those values.

  • 1 « The evolution of hyperbolic discounting: Implications for truly social valuation » (2013), Journa (...)

4After dealing with quite general aspects of the economic theory, we focus with John Gowdy and J. Barkley Rosser Jr.1 on a particular technical dimension of valuations, discounting, in order to explore the relevance of valuations at a more detailed level. We study the relevance of the traditional discounting approach (the exponential utility discounting model) and of the alternative hyperbolic discounting approach, for estimating social environmental valuations. Again with an interdisciplinary approach (behavioral, neuro-economics, evolutionary economics), we suggest that hyperbolic discounting is more appropriate than exponential discounting to reflect human decision making. However, this adequacy is not sufficient to promote hyperbolic discounting for public decision making, as what is (positive) should not necessarily be the standard for what ought to be (normative).

5Finally, in the 4th and last article, we discuss the notion of biodiversity and biodiversity’s economic status, to ultimately confront our result with the vision that mainstream valuations of biodiversity adopt of biodiversity. This allows us to analyze which dimensions of biodiversity valuations seemed to take into account or not by valuations. We realize that those valuations are far for valuing biodiversity per se, and in particular its functional dimension, even though it is at the basis of biodiversity’s ecological value.

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1 « The evolution of hyperbolic discounting: Implications for truly social valuation » (2013), Journal of Economic Behavior & Organization, 90S, pp. 94–104.

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Loraine Roy, « The relevance of monetary valuations of biodiversity for public decision makers », Trajectoires [En ligne], 8 | 2014, mis en ligne le 15 décembre 2014, consulté le 21 janvier 2018. URL :

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