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Biodiversity and local asset values

Author

Listed:
  • Jess Cornaggia
  • Yu-Hsuan (Jennifer) Liang
  • Peter Iliev
  • Qiang Wang

Abstract

We provide a national-scale benchmark on how biodiversity is priced in local assets in the United States. Property prices increase with local biodiversity loss, likely reflecting development-driven monetization. In contrast, at the regional level, greater species richness correlates with higher asset values, indicating that remaining regional biodiversity is viewed as an amenity. Over time, the premium from biodiversity loss weakens, while the valuation of regional biodiversity strengthens. The link between biodiversity and property prices is higher when public attention to biodiversity is high. Together, these results highlight a shift in market preferences: biodiversity is increasingly recognized and priced as natural capital since the turn of the century. This evidence shows how ecological conditions are capitalized into local asset values and highlights implications for conservation policy and sustainable land use.

Suggested Citation

  • Jess Cornaggia & Yu-Hsuan (Jennifer) Liang & Peter Iliev & Qiang Wang, 2026. "Biodiversity and local asset values," Review of Finance, European Finance Association, vol. 30(1), pages 391-421.
    • Handle: RePEc:oup:revfin:v:30:y:2026:i:1:p:391-421.
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    File URL: http://hdl.handle.net/10.1093/rof/rfaf051
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    JEL classification:

    • G1 - Financial Economics - - General Financial Markets
    • N5 - Economic History - - Agriculture, Natural Resources, Environment and Extractive Industries
    • Q1 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture
    • Q2 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation
    • Q3 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation
    • Q5 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics
    • R1 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics
    • R3 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location

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