How risk-diversification for conservation investment is affected by the real estate market shock triggered by the COVID-19 pandemic

Real-estate prices have soared since the start of the COVID-19 pandemic amid historically low mortgage rates and limited supply. The external shock observed in the real-estate market through relief measures may trigger changes in optimal conservation portfolios. The objective of this research is to identify the impacts of the real-estate market shock triggered by the pandemic through low-interest rates and limited real-estate supply on risk-diversification strategies for land conservation investment and to understand the implications of these impacts. We use a case study involving biodiversity conservation in the central and southern Appalachian region of the US by comparing modern portfolio theory (MPT) outputs using future conservation cost predictions with and without the shock. We find that the financial burden to fund the same level of risk-diversifying conservation benefits increases due to the shock and increases at an increasing rate as the return on investment (ROI) objective rises. This finding is alarming since higher conservation costs triggered by the shock decrease the cost-effectiveness of risk diversification, and this effect exacerbates with the goal of achieving higher ROI. Spatial diversification strategies with and without the shock offer risk-diversification information to help conservation organizations determine effective investment strategies.

Global animal protein trade impacts of largescale human health events

The emergence of largescale global human health events is expected to increase with evolving zoonotic and transboundary diseases, climate change, agricultural consolidation, increased globalization, and reliance on trade. The government and market response to a disease is dependent on the size of the outbreak, pathogenicity and virulence of the disease, and the perceived risks of its introduction and spread. The impact of largescale human disease events and their respective institutional response can lead to financial and market disruptions and effect nearly every industrial sector and market, including animal protein trade. The latest human disease event, the COVID-19 (SARS-CoV-2) pandemic, continues to be the largest, most expansive disease event in the last century. The COVID-19 pandemic has had sizeable implications domestically and internationally. Labor shortages and supply chain disruptions coupled with demand changes and disease eradication policies substantially impacted global markets. Despite the emergent literature on COVID-19, little has been done to collectively identify and analyze the effects of largescale human health events on animal protein trade. Using export trade data from 2010-2020 for animal protein exporters, this analysis estimates the effects human health events (i.e., MERS-Cov, COVID-19, Ebola, and Zika virus) on global animal protein trade for 23 individual commodities (6-digit HS level). Results show heterogeneity between diseases, products, and exporters. This heterogeneity indicates differences in response between events, dependent on event size, scope, and impacts. The study results can help improve preemptive business continuity planning and deepen the understanding of the implications of future emerging largescale health events on the meat industry.