Agricultural producer participation and spatial coordination of land use decisions are key components for enhancing the effective delivery of ecosystem services from private land. However, inducing ...participation in Payment for Ecosystem Services schemes for coordinating land management choices is challenging from a policy design perspective owing to transaction costs associated with participation. This paper employs a laboratory experiment to investigate the impact of such costs on participation and land use in the context of an Agglomeration Bonus (AB) scheme. The AB creates a coordination game with multiple Nash equilibria related to alternative spatially-coordinated land use patterns. The experiment varies transaction costs between two levels (high and low), which affects the risks and payoffs of coordinating on the different equilibria. Additionally, an option to communicate is implemented between neighbors arranged on a local network to facilitate spatial coordination. Results indicate a significant difference in participation and performance under high and low transaction costs, with lower uptake and performance when transaction costs are high. These effects are, however, impacted by transaction costs faced in the past. Communication improves both AB participation rates and performance with the effect being greater for participants facing high transaction costs.
The Agglomeration Bonus is a Payment for Ecosystem Services scheme that focuses on achieving spatially-coordinated land use across neighboring, privately-owned agricultural properties. In this ...article, I use a laboratory experiment to examine the role of two mechanisms in incentivizing spatially coordinated land uses under the Agglomeration Bonus scheme on a geographical landscape resembling a local circular network. The first mechanism is pecuniary in format and varies the payoffs associated with coordination, while the second is a non-pecuniary mechanism that varies the amount of information participants have about the land use choices of other participants, specifically of those from another community. The payoff variation is implemented as a within-subject treatment and the information treatment in a between-subject format. The results indicate that the coordination rates are higher if payments associated with coordination are higher. Also, having information about outcomes of the Agglomeration Bonus scheme from another community improves spatial coordination rates in both communities.
Abstract
The concept of adaptive capacity has received significant attention within social-ecological and environmental change research. Within both the resilience and vulnerability literatures ...specifically, adaptive capacity has emerged as a fundamental concept for assessing the ability of social-ecological systems to adapt to environmental change. Although methods and indicators used to evaluate adaptive capacity are broad, the focus of existing scholarship has predominately been at the individual- and household- levels. However, the capacities necessary for humans to adapt to global environmental change are often a function of individual and societal characteristics, as well as cumulative and emergent capacities across communities and jurisdictions. In this paper, we apply a systematic literature review and co-citation analysis to investigate empirical research on adaptive capacity that focus on societal levels beyond the household. Our review demonstrates that assessments of adaptive capacity at higher societal levels are increasing in frequency, yet vary widely in approach, framing, and results; analyses focus on adaptive capacity at many different levels (e.g. community, municipality, global region), geographic locations, and cover multiple types of disturbances and their impacts across sectors. We also found that there are considerable challenges with regard to the ‘fit’ between data collected and analytical methods used in adequately capturing the cross-scale and cross-level determinants of adaptive capacity. Current approaches to assessing adaptive capacity at societal levels beyond the household tend to simply aggregate individual- or household-level data, which we argue oversimplifies and ignores the inherent interactions within and across societal levels of decision-making that shape the capacity of humans to adapt to environmental change across multiple scales. In order for future adaptive capacity research to be more practice-oriented and effectively guide policy, there is a need to develop indicators and assessments that are matched with the levels of potential policy applications.
Conservation auctions are used by public agencies to procure environmental friendly land uses from private landowners. We present the structure of an iterative conservation auction that ranks bids ...according to a scoring rule intended to procure spatially adjacent conservation land use projects. Laboratory experiments are conducted to compare the performance of this auction under two information conditions. Under one condition subjects have knowledge about the spatial goal implemented by the scoring rule and in the other case they don’t. The results indicate that rent-seeking is intensified with more information and increased bidder familiarity with the auction. Revealing the spatial information on the other hand has no impact on auction efficiency.
The Agglomeration Bonus (AB) is a subsidy mechanism intended to induce adjacent landowners to coordinate environmental conservation activities. This paper explores the effects of landowner group size ...on spatial coordination under the AB in laboratory experiments where players are located on circular local networks. The experiments indicate a significant difference in patterns of coordination between groups. Additionally, global coordination on a single strategy is obtained in half of the groups and in the remaining half, both strategies exist giving rise to localized areas of coordinated land uses on the network.
► We consider the Agglomeration Bonus subsidy scheme as a coordination game. ► We consider this game on a local network where every individual has two neighbors. ► We analyze equilibrium selection & spatial coordination using lab experiments. ► The treatment variable is network size — small & large with six & twelve players. ► There is both global and localized coordination of land uses in small and large networks.
The agglomeration bonus is an incentive mechanism to induce adjacent landowners to spatially coordinate their land use for the delivery of ecosystem services from farmland. This paper uses laboratory ...experiments to explore the performance of the agglomeration bonus in achieving the socially optimal land management configuration in a local network environment where the information available to subjects varies and the strategic setting is unfavorable for efficient coordination. The experiments indicate that if subjects are informed about both their direct and indirect neighbors' actions, they are more likely to produce the socially optimal configuration. Thus effectiveness of the policy can be improved by implementing information dissemination exercises among landowners. However given the adverse strategic setting, increased game experience leads to coordination failure and optimal land choices only at the localized level independent of the information available to subjects. Thus success of the agglomeration bonus scheme on real landscapes will have to take account of the roles of both information and experience on participant behavior.
The authors present a semester-long game to teach the role of economics in natural resources management. The game is framed within a fisheries context: multiple student fisheries harvest fish to ...maximize yield/profit, which is measured using a piecewise linear function. There are prizes for both the student and the group with the highest semester-long catch, which brings forth the social dilemma associated with dynamic stock externalities in fisheries. The game can be played in large classes, is robust to student attrition, and requires 5-10 minutes per class period. Given its features, it can be used to teach behavioral economic principles in resource management, incentives versus command-and-control regulations, role of cheap talk, social preferences, punishment, and community management as well as solutions such as aquaculture.
Agri‐environmental schemes (AESs) are increasingly implemented to promote the adoption of environmentally friendly practices by farmers. We use a systematic review to explore the role of behavioural ...factors and opportunity costs in farmers' decisions to participate in AESs in Australia, Europe and North America. Behavioural factors influence how farmers value and perceive options, while opportunity costs relate to farmers' forgone utility when choosing to participate in schemes. We synthesise insights from 79 articles and over 700 factors explaining the participation in AESs. We find that a set of behavioural factors seem consistently connected to participation, including agricultural training, advice and having positive attitudes towards AESs. Moreover, several factors related to opportunity costs also have a rather consistent relationship with AES participation, including market conditions, implementation efforts, profitability, and management and contract flexibility. However, many relationships of behavioural factors and opportunity costs with AES participation are not as consistent and generalizable as sometimes portrayed and require context‐specific interpretation. Those factors with mixed results can still provide insights into farmers' participation decisions as several of them are either ‘positively and insignificantly’ or ‘negatively and insignificantly’ related to participation, such as environmental attitude, trust and farm size. These results suggest that their relationship with AES participation depends on other factors or the setting, highlighting interactions and raising important new research questions. Overall, our results provide several entry points for both researchers and policy‐makers, highlighting uncertainties in relationships between factors and participation that should be considered when designing policies.
How best to incentivize land managers to achieve conservation goals in an economically and ecologically effective manner is a key policy question that has gained increased relevance from the setting ...of ambitious new global targets for biodiversity conservation. Conservation (reverse) auctions are a policy tool for improving the environmental performance of agriculture, which has become well‐established in the academic literature and in policy making in the US and Australia. However, little is known about the likely response of farmers to incentives within such an auction to (1) increase spatial connectivity and (2) encourage collective participation. This paper presents the first framed field experiment with farmers as participants that examines the effects of two features of conservation policy design: joint (collective) participation by farmers and the incentivization of spatial connectivity. The experiment employs farmers in China, a country making increasing use of payments for ecosystem services to achieve a range of environmental objectives. We investigate whether auction performance—both economic and ecological—can be improved by the introduction of agglomeration bonus and joint bidding bonus mechanisms. Our empirical results suggest that, compared to a baseline spatially coordinated conservation auction, the performance of an auction with an agglomeration bonus, a joint bidding bonus, or both, is inferior on two key metrics—the environmental benefits generated and cost effectiveness realized.
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