Common-Property Resource Exploitation: A Real Options Approach

Agricultural land and forestlands can have multiple uses generate sources of utility. Although landowners benefit from most them, society others because their intrinsic characteristics as common-property resources customary practice. In many Italian territories, the picking mushrooms is allowed on privately owned agricultural in forests. The management these challenging due to emerging conflicts between users. addition, pressure exerted by users gives rise issues stock preservation, thus contributing putting biodiversity at risk contexts already heavily jeopardized modern agriculture. Through years, regulation established primacy landowner’s right, introduced a permit fee for users, set limits resource be collected daily. Nonetheless, relationship public private interests exploitation still controversial. this paper, we investigate model right holder’s decision whether exploit according actual status being an or potential user. developed within real options valuation framework. detail, entry/exit considering uncertainty that affects stock, entry/exist costs, number rival