Model Uncertainty, Ambiguity and the Precautionary Principle: Implications for Biodiversity Management

We analyze ecosystem management under ‘unmeasurable’Knightian uncertainty or ambiguity which, given the uncertainties characterizing ecosystems, might be a more appropriate framework relative to the classic risk case (measurable uncertainty). This approach is used as a formal way of modelling the precautionary principle in the context of least favorable priors and maxmin criteria.We provide biodiversity management rules which incorporate the precautionary principle. These rules take the…

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