[Coral-List] . Re: $33B Hawaii Reef Economics Value

Matt Bjornson mbjornson at gmail.com
Wed Nov 23 16:11:10 EST 2011

I am not involved a scientist like the majority here, though I hold advanced degrees in economics and finance...  A couple of thoughts...
- valuation is hardly the science that us with advanced degrees make it. IMHO this is a limitation in finance/economics, value is purely subjective!  If you are passionate about the reefs, you value the reefs much more than another who doesn't care about reefs...
- there are many methods or tools to value specific assets, some simple, other insanely complex. An example of these include the net present value of a perpetuity that is simple and at the other end of the scale is something like real options. Some tools are better suited than others depending on the situation.  ( IMHO, with all the potentials for action and the highly "connectedness of reef ecosystems, I'd argue real options is more apropos than the former) Also, key to these methods include identifying what an appropriate discount factor is, or what probabilities of a particular decision is - all very difficult to quantify...
- related to the previous items but exacerbates this issue, what is the value of species endangerment/extinction and in many developing nations where many obtain sustenance from the seas/oceans/reefs, what is the value of human life? Are we, or any species simply a sum of our monetary outputs or contributions? I think not...

2 cents...

On Nov 22, 2011, at 2:43 PM, Eugene Shinn <eshinn at marine.usf.edu> wrote:

> Dear Listers, I did not expect everyone to agree with my last posting 
> on the value of the Hawaii coral reef.  Yes it is priceless, what 
> ever that means. Don't we all receive a lot of on-line jokes that 
> claim to be "priceless."?
>     I am reminded that when I worked for USGS and wrote proposals for 
> funds to do coral reef studies I always had to justify the work by 
> providing a value of the reef I wanted to study.  The value was an 
> inflated amount based on the amount of money tourist spent in the 
> Florida Keys each year. Those numbers were usually provided by the 
> Key West Chamber of Commerce or the Marine Sanctuary and were likely 
> inflated to attract more tourist revenue. It always seemed to me that 
> what diving tourists appeared to appreciate most was the clear warm 
> water that beat the heck out of diving back home.  Because of 
> "shifting baselines" few tourist had ever seen the reefs in their pre 
> 1980s pristine glory to compare it with the present situation. All 
> they seemed to care about was that the diving was a lot better than 
> diving in that cold dark quarry back in Michigan. Because of this I 
> can't help but get a knee-jerk reaction when people put a monetary 
> value on a coral reef or anything in nature. I'm sorry if I offended 
> anyone. It seems that society is so divided on any issue these days 
> that no one agrees on anything. Gene
> -- 
> No Rocks, No Water, No Ecosystem (EAS)
> ------------------------------------ -----------------------------------
> E. A. Shinn, Courtesy Professor
> University of South Florida
> College of Marine Science Room 221A
> 140 Seventh Avenue South
> St. Petersburg, FL 33701
> <eshinn at marine.usf.edu>
> Tel 727 553-1158---------------------------------- 
> -----------------------------------
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