In negotiations over land-right acquisitions, landowners have an informational advantage over conservation groups because they know more about the opportunity costs of conservation measures on their ...sites. This advantage creates the possibility that landowners will demand payments greater than the required minimum, where this minimum required payment is known as the landowner’s willingness to accept (WTA). However, in recent studies of conservation costs, researchers have assumed landowners will accept conservation with minimum payments. We investigated the ability of landowners to demand payments above their WTA when a conservation group has identified multiple sites for protection. First, we estimated the maximum payment landowners could potentially demand, which is set when groups of landowners act as a cooperative. Next, through the simulation of conservation auctions, we explored the amount of money above landowners’ WTA (i.e., surplus) that conservation groups could cede to secure conservation agreements, again investigating the influence of landowner cooperatives. The simulations showed the informational advantage landowners held could make conservation investments up to 42% more expensive than suggested by the site WTAs. Moreover, all auctions resulted in landowners obtaining payments greater than their WTA; thus, it may be unrealistic to assume landowners will accept conservation contracts with minimum payments. Of particular significance for species conservation, conservation objectives focused on overall species richness,which therefore recognize site complementarity, create an incentive for land owners to form cooperatives to capture surplus. To the contrary, objectives in which sites are substitutes, such as the maximization of species occurrences, create a disincentive for cooperative formation.
Voluntary conservation agreements are commonly used to stem the impact of habitat destruction and degradation on terrestrial biodiversity. Past studies that aim to inform how resources for ...conservation should be allocated across land parcels have assumed the costs of securing conservation on sites can be estimated solely on the basis of the value of alternative land uses. However, in a voluntary negotiation, a landowner could hold-out for a higher payment based on a conservation group or agency’s willingness-to-pay by leveraging the value of biodiversity on the property. We examine landowners’ ability to leverage and the consequences for conservation planning. To explore this, we first use an analytical approximation that simplifies the situation to one where a conservation group prioritizes one site for acquisition. Landowners’ ability to hold-out for higher payments in this situation ranges from approximately 17% to 55% of the value of alternative land uses on the site. We show that landowners’ ability to hold-out for higher payments is more sensitive to variance in the value of alternative land uses than variance in the biodiversity value across properties and is highest when the two factors negatively covary. Next, we consider multi-site selection decisions accounting for community complementarity across parcels. We find that leverage potential can be significantly higher in this context, with a maximum increase of 237% of the value of alternative land uses, and that community irreplaceability is correlated with landowners’ ability to leverage. If one landowner holds out for a higher payment, it has implications for what other parcels should be priorities for protection.
Globally, much biodiversity is found on private land. Acting to conserve such biodiversity thus requires the design of policies which influence the decision-making of farmers and foresters. In this ...chapter, the economic characteristics of this problem are outlined, before reviewing a number of policy options, such as conservation auctions and conservation easements. A number of policy design problems are then discussed, such as the need for spatial coordination and the choice between paying for outcomes rather than actions, before summarizing what the evidence and theory developed to date tell us about those aspects of biodiversity policy design which need careful attention from policy-makers and environmental regulators.
Globally, much biodiversity is found on private land. Acting to conserve such biodiversity thus requires the design of policies which influence the decision- making of farmers and foresters. In this ...paper, we outline the economic characteristics of this problem, before reviewing a number of policy options such as conservation auctions and conservation easements. We then discuss a number of policy design problems, such as need for spatial coordination and the choice between paying for outcomes rather than actions, before summarizing what the evidence and theory developed to date tells us about those aspects of biodiversity policy design which need careful attention from policy makers and environmental regulators.
