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Valuing long run ecological consequences and irreversibilities
Authors:Anthony C Fisher  John V Krutilla
Institution:Department of Economics, University of Maryland, College Park, Maryland 20742, USA;Resources for the Future, Washington, D. C. 20036, USA
Abstract:In this paper we consider the special nature and implications, for economic theory and policy, of resource uses that involve adverse effects on the physical environment that are difficult or impossible to reverse. Distinctions are drawn between reversible and irreversible activities, between replaceable and irreplaceable resources. The existence of an “irreversibility premium” is demonstrated under certain plausible conditions, including uncertainty and shifting time perspective.
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