Option Value of Apex Predators: Evidence from a River Discontinuity

Abstract

"Option value" provides theoretical justification for conserving wildlife species lacking known value, but empirical assessments of actual realizations are rare. We examine quasi-option value in the context of gray wolf eradication, which aimed to protect humans and their property historically, but also reduced the potential for wolves to improve human well-being today. We estimate the effects of long-run differences in the presence of wolves north, but not south, of Canada’s Saint Lawrence River on animal-related (primarily deer) vehicle collisions. Wolves reduce the share of animal collisions by 38 percent, reducing risk to human life and property.

Reference

Eyal G. Frank, Anouch Missirian, Dominic P. Parker, and Jennifer L. Raynor, “Option Value of Apex Predators: Evidence from a River Discontinuity”, NBER Working Papers, n. 34377, October 2025.