Addressing the Collective Action Problem in Multiple-purchaser PES: An Experimental Investigation of Negotiated Payment Contributions

Smith, Greg Sambrook; Day, Brett

doi:10.1016/j.ecolecon.2017.07.020

Cited by 5 publications

(3 citation statements)

References 51 publications

(59 reference statements)

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“…However, their study did not focus on spatial conservation auctions. Smith and Day (2018) consider the negotiation between joint (two) purchasers who make an offer to one provider (here the farmer) in a general AES. Our experiment studies the opposite setting, with competition on the provider/bidder side, and negotiations between multiple bidders who make offers to one purchaser -a government agency.…”

Section: Introductionmentioning

confidence: 99%

Spatial Coordination and Joint Bidding in Conservation Auctions

Banerjee¹,

Cason²,

Vries³

et al. 2021

Journal of the Association of Environmental and Resource Econom

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Spatial coordination of land use change is pivotal in agri-environmental policy to improve the delivery of environmental goods. This paper implements a laboratory experiment to study spatial coordination in a conservation auction. In addition to letting individual producers bid competitively against each other to supply environmental goods, we ask whether opportunities for joint bidding can enhance spatial coordination in the auction cost-effectively. Auction performance depends on the nature of incentives for individual bids; in particular, whether an agglomeration bonus is offered for individual bids. With an individual bonus in place, joint bidding gives no improvement in either environmental benefits procured or cost-effectiveness. Absent an individual bonus, joint bidding improves environmental performance but can decrease cost-effectiveness. Further, across both individual and joint bidding treatments, the average environmental benefits, degree of spatial coordination and cost-effectiveness is greater, and amount of seller markups lower, with multi-round bidding compared to single round bidding. The authors are grateful to the Marine Alliance for Science and Technology for Scotland (MASTS) pooling initiative for financial support. MASTS is funded by the Scottish Funding Council (grant reference HR09011) and contributing institutions. We thank James Keeler and Town Oh for excellent research assistance. For valuable comments we thank three anonymous referees, the editor (Christian Vossler), Ben Balmford,

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Section: Introductionmentioning

confidence: 99%

Spatial Coordination and Joint Bidding in Conservation Auctions

Banerjee¹,

Cason²,

Vries³

et al. 2021

Journal of the Association of Environmental and Resource Econom

View full text Add to dashboard Cite

show abstract

“…Our paper also relates to a complimentary study, Smith and Day (2018), who show, in the context of a two-purchaser PES scheme, that there always exists incentives for beneficiaries of a public good to free-ride when there is the possibility of another buyer paying for the public good. The authors go on to show that negotiation can overcome this collective action problem in a laboratory experiment.…”

Section: Purchasers Of Ecosystem Servicesmentioning

confidence: 88%

Multiple-Purchaser Payments for Ecosystem Services: An Exploration Using Spatial Simulation Modelling

Smith

Day

Binner

2019

Environ Resource Econ

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This paper focuses on the issue of payments for ecosystem services (PES) mechanism design when the activity incentivised through the scheme benefits multiple groups, each of whom might be prepared to contribute to payments made through the scheme. In particular, we examine spatial coordination on the demand side of the market; that is to say, the question of which beneficiary of the PES scheme buys land-management changes on which land parcels. We show through spatial simulation modelling that it is possible for negotiation to lead to Pareto improvements when compared to solutions reached through non-cooperative strategic solutions; however, we also show that this result is not universal and only holds under certain conditions. In particular, the spatial correlation and spatial interdependence of the ecosystem service benefits are key in determining whether negotiation between beneficiaries is optimal and therefore if policy makers and designers of PES schemes should be prioritising bringing together multiple beneficiaries of ecosystem services.

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“…Research on conservation auctions tested agglomeration bonuses (Parkhurst et al, 2002;Parkhurst & Shogren, 2007;etc. ), spatial-connection incentives (Banerjee et al, 2015;Fooks et al, 2016;Krawczyk et al, 2016;Liu et al, 2019;Windle et al, 2009); and joint bidding (Banerjee et al, 2021;Calel, 2012;Iftekhar & Tisdell, 2017;Rondeau et al, 2016;Smith & Day, 2018). Various research methods were used, including agent-based simulation models (Iftekhar & Tisdell, 2017); laboratory experiments (Banerjee et al, 2021;Krawczyk et al, 2016;Rondeau et al 2016); and framed field experiments (Liu et al, 2019 142 ).…”

Section: Combining Competition and Collective Action In Pes Researchmentioning

confidence: 99%

Farmers’ Preferences for Agri-Environmental Incentive Programs, Learning from Experiences in Ontario

Lemaitre-Curri¹

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Based on a literature review, an international benchmark, and a case study in Ontario, the dissertation explores farmers' preferences for agri-environmental incentive programs. We use literature in agricultural, environmental and behavioural economics, and social psychology to propose an original analytical framework of farmers' preferences. This framework is tested in Ontario and helps understand farmers' motivations to participate or not to participate in environmental incentive programs.We then review the evolution of agri-environmental programs in Ontario since the 1930s.We develop original frameworks to compare programs fostering either collaboration or competition among farmers and use these frameworks to compare Ontario programs with contrasting programs in other provinces and OECD countries.Based on program design analysis and semi-structured interviews, we identify program characteristics that matter to Ontario farmers. Through a choice experiment, we then test which characteristics matter most in farmers' decisions and segment Ontario farmers into groups of heterogeneous preferences.The dissertation decisively adopts a mixed-methodology approach. Qualitative research is used to design the choice experiment (exploratory sequential design). Open-ended questions in the experiment link farmer choice-profiles with qualitative results, thus confirming, illustrating or nuancing choice experiment findings (convergent design).Finally, the participation of informal field advisors all along the research process allows for a research design targeted on current policy questions and continuous verification of intermediate findings.iv We find that programs designed to be the most competitive are not necessarily the most cost-efficient because medium and long-term dimensions are not considered. We identify five farmer profiles with different preferences and attitudinal traits. While 'Business Farmers' and 'Busy Farmers' have a strong preference for high incentive levels, other types of farmers either value technical assistance above the monetary incentive, are only willing to participate if their contact point is a fellow farmer, or are largely unwilling to participate.Several farmer profiles would prefer collective approaches. We also find that preferences are endogenous. They evolve as information emerges, applications succeed or fail, engagement takes place, and farmers discuss approaches and their impacts. The concluding chapter presents, on this basis, a series of research-grounded recommendations for agrienvironmental policy design in Ontario. v AcknowledgementsAfter many years pushing back at the idea of engaging in a Ph.D. thesis, I remember a calm winter day, looking at the trees and fluffy snow by the cross-country ski tracks and finally realizing that I was ready for the adventure.I dedicate this thesis to my mother-in-law, Dr. Gudrun Curri, who made sure that this vague idea became a reality. Not only did she introduce me to the great team of professors at the Carleton University School of Public Policy and...

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Addressing the Collective Action Problem in Multiple-purchaser PES: An Experimental Investigation of Negotiated Payment Contributions

Cited by 5 publications

References 51 publications

Spatial Coordination and Joint Bidding in Conservation Auctions

Spatial Coordination and Joint Bidding in Conservation Auctions

Multiple-Purchaser Payments for Ecosystem Services: An Exploration Using Spatial Simulation Modelling

Farmers’ Preferences for Agri-Environmental Incentive Programs, Learning from Experiences in Ontario

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