Arbeitspapier

New trade in renewable resources and consumer preferences for diversity

The literature on trade in renewable resources implicitly assumes that the traded resources are perfect substitutes. We model trade in renewable resources as stipulated not only by autarky price differences, but also by consumers' love of variety. We show that the love-of-variety effect enables welfare gains from trade even if total consumption decreases. Total consumption may decrease because the love of variety weakens the link between resource scarcity and demand. If consumers are willing to pay the rising prices for harvests from increasingly depleted stocks, trade liberalization may end in stock collapse. The love of variety may thus threaten variety.

Language
Englisch

Bibliographic citation
Series: Economics Working Paper ; No. 2014-08

Classification
Wirtschaft
Renewable Resources and Conservation: Demand and Supply; Prices
Renewable Resources and Conservation: Fishery; Aquaculture
Renewable Resources and Conservation: Forestry
Renewable Resources and Conservation: Issues in International Trade
Trade and Environment
Subject
trade
environment
renewable resources
open access
love of variety

Event
Geistige Schöpfung
(who)
Quaas, Martin F.
Stöven, Max T.
Event
Veröffentlichung
(who)
Kiel University, Department of Economics
(where)
Kiel
(when)
2014

Handle
Last update
10.03.2025, 11:43 AM CET

Data provider

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Object type

  • Arbeitspapier

Associated

  • Quaas, Martin F.
  • Stöven, Max T.
  • Kiel University, Department of Economics

Time of origin

  • 2014

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