Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/59729 
Year of Publication: 
2012
Series/Report no.: 
Nota di Lavoro No. 31.2012
Publisher: 
Fondazione Eni Enrico Mattei (FEEM), Milano
Abstract: 
We distinguish between local problems of biodiversity loss and global ones, where international cooperation is required. Global biodiversity regulation involves choosing the optimal stopping rule regarding global land conversions, in order to ensure that some areas of unconverted natural reserves remain to support the production sector that exists on converted lands. The basic difficulty with implementing a solution to this global problem lies in the asymmetry in endowments between those states that have previously converted, and those that have not. We demonstrate that the fundamental problem of global biodiversity regulation is similar to the bargaining problem analysed by Nash, Rubinstein and others. There are benefits from global land conversion, and there must be agreement on their distribution before the conversion process can be halted. Since the institutions addressing global biodiversity problems are either highly ineffectual (benefit sharing agreements, prior informed consent clauses) or very extreme (incremental cost contracts), the biodiversity bargaining problem remains unresolved. For this reason we anticipate that suboptimal conversions will continue to occur, as a way of protesting the ineffective and unfair approaches employed in addressing this problem to date.
Subjects: 
Global Biodiversity
International Environmental Policy
Nash Bargaining
Rational Threats
JEL: 
Q24
Q28
Document Type: 
Working Paper

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