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On the Consumer Value of Diversity: An Application to Italian Fish
Author(s) -
Chavas JeanPaul,
Baggio Michele
Publication year - 2011
Publication title -
journal of agricultural economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.157
H-Index - 61
eISSN - 1477-9552
pISSN - 0021-857X
DOI - 10.1111/j.1477-9552.2011.00298.x
Subject(s) - complementarity (molecular biology) , convexity , valuation (finance) , diversity (politics) , value (mathematics) , economics , fish <actinopterygii> , microeconomics , econometrics , mathematics , statistics , fishery , sociology , financial economics , biology , genetics , finance , anthropology
This article investigates the consumer value of diversity both conceptually and empirically. It proposes a measure of diversity value based on a benefit function. It shows that the consumer value of diversity can arise from complementarity and/or convexity effects among consumer goods. The usefulness of the approach is illustrated by an application to fish in Italy. The investigation illustrates the role played by both convexity and complementarity in the valuation of diversity. The empirical evidence shows the importance of dynamics. It also documents how the value of diversity varies depending on the bundles considered.