The precautionary principle and environmental risk management: Contributions and limitations of economic models

Abstract

This article presents the most relevant economic approaches and models that have been developed for the economic interpretation of the precautionary principle. The aim is to identify their contribution to the debate on precaution and discuss their practical significance in public decision-making. In addition to analysing their virtues and main limitations some actions aimed at overcoming these limitations are also identified. The concept of precaution is of great relevance in environmental regulation in many countries. However, legislation about the use of the precautionary principle in environmental decision-making is somewhat vague. As a result, there is broad consensus on the need for a regulatory framework for the principle's operational implementation so that concepts and management procedures that are appropriate to the nature of environmental risks are clarified.