R. David Simpson
Resources for the Future, 1616 P Street NW, Washington, DC 20036
Abstract: It is often argued that maintaining genetic diversity is a valuable insurance policy against crop failure. In this paper the economic value of diversity is related to the scarcity of genetic resources. Different modes of analysis are proposed for qualitative and quantitative genetic attributes, although both approaches can be related to the theory of order statistics. Economic value is "value on the margin." While the total worth to society of agricultural genetic resources is immeasurable, the marginal value is typically much smaller. Additional biological diversity for use in agricultural improvement may be thought of as more "draws" to be taken from a random sample of potential outcomes in which only the best is chosen for cultivation. Value on the margin is then the expected improvement in the welfare realized from the best in the sample. When the numbers of potential progenitors available for agricultural improvement is large, the marginal value of additional biodiversity can become quite small. These principles are illustrated with an example from a teak forestry improvement program.
Key words: agriculture; biodiversity; economic valuation; genetic resources; qualitative characteristics; quantitative characteristics; social welfare; teak.
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