Conservation Priorities and Environmental Offsets: Markets for Florida Wetlands / Daniel Aronoff, Will Rafey.

Format:

Book

Author/Creator:

Aronoff, Daniel.

Contributor:

National Bureau of Economic Research.

Rafey, Will.

Series:

Working Paper Series (National Bureau of Economic Research) no. w31495.

NBER working paper series no. w31495

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2023.

Summary:

We introduce an empirical framework for valuing markets in environmental offsets. Using newly-collected data on wetland conservation and offsets, we apply this framework to evaluate a set of decentralized markets in Florida, where land developers purchase offsets from a small number of long-lived producers that restore wetlands over time. We find that offsets led to substantial private gains from trade, creating about $2.2 billion of net surplus from 1995-2018 relative to a historical conservation mandate. Offset trading also led to large differences in hydrological outcomes, driven by significant differences between restored and existing wetlands in terms of area and location. A locally differentiated Pigouvian tax on offset transactions would have prevented $1.3 billion of new flood damage while preserving more than two-thirds of the private gains from trade.

Notes:

Print version record

July 2023.