Irreversibility and Sustainability: Attempts to Save the Florida Everglades

Abstract

AbstractThe Everglades is a subtropical wetland in Florida encompassing a watershed area over 18,000 square miles. We provide a spatial price equilibrium model in order to determine the benefits and costs of several proposed buyout strategies. Florida Governor Charlie Christ originally proposed the acquisition of 187,000 acres of land from the U.S. Sugar Corporation (U.S. Sugar) in 2008, in an effort to restore the Florida Everglades. However, in 2010, the final litigation only covered 26,800 acres. Our analysis includes the cost to clean up the Everglades and shows that the benefits were less than the costs within an ex ante vs. ex post framework. Importantly, this research develops and applies the concept of an Environmental Equivalent, which is the dollar amount of environmental benefits needed from the Everglades restoration or water quality projects to generate a benefit-cost ratio greater than one.