Title: Environmental investment and valuation: a Keynesian (and Freudian) perspective

Authors: James Juniper

Addresses: School of Economics, Politics and Tourism, University of Newcastle, Room SRS239, University Drive, Callaghan NSW 2308, Australia

Abstract: The objective of the article is to critically assess the approach taken by Basili (1994) and Vercelli (1994) towards the valuation of non-marketed environment assets. To this end, the article examines Keynes|s approach to uncertainty and irrationality as influences over economic behaviour. Modern interpretations of these Keynesian insights, which have been influenced by neoclassical quantitative finance and psychological theories of decision-making, are then reviewed. A brief overview of how real options theory has been applied to the analysis of corporate investment sets the scene for a discussion of Basili and Vercelli|s concept of the quasi-option values associated with the valuation of environmental assets. A |destructive| critique is mounted against neoclassical approaches to valuation and the article concludes with a series of |constructive| philosophical observations, drawing on Spinozian aspects of Whitehead|s process philosophy.

Keywords: atomism; environmental capital; fundamental uncertainty; money love; organicism; real options theory; environment assets; environmental investment; valuation; economic behaviour; corporate investment.

DOI: 10.1504/IJEWE.2007.019281

International Journal of Environment, Workplace and Employment, 2007 Vol.3 No.3/4, pp.230 - 247

Published online: 06 Jul 2008 *

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