Harvesting versus biodiversity: An Occam's Razor version

The point of departure for this paper is the familiar prototype fisheries m odel where a fictitious sole owner harvests a fish population to maximize p resent discounted profits. The paper answers analytically the following que stion. "What happens to a policy when the sole owner also values biodiversi ty, as well as profits?'' It turns out that the size of the steady-state st ock and the number of species preserved are both higher, when species diver sity is positively valued. This paper provides a sharp characterization of the optimal policy in terms of the usual economic parameters and an exogeno usly introduced willingness-to-pay function for species preservation.