The efficiency of voluntary incentive policies for preventing biodiversity loss

Habitat loss is a primary cause of loss of biodiversity but conserving habitat for species presents challenges. Land parcels differ in their ability to produce returns for landowners and landowners may have private information about the value of the land to them. Land parcels also differ in the type and quality of habitat and the spatial pattern of land use across multiple landowners is important for determining the conservation value of parcels. This paper analyzes the relative efficiency of simple voluntary incentive-based policies in achieving biodiversity conservation objectives. This topic is important not just for biodiversity conservation but for any effort to provide a public good requiring coordination across multiple decision-makers who have some degree of private information. We develop a method that integrates spatially explicit data, an econometric model of private land-use decisions, landscape simulations, a biological model of biodiversity as a function of landscape pattern, and an algorithm that estimates the set of efficient solutions. These methods allow us to simulate landowner responses to policies, measure the consequences of these decisions for biodiversity conservation, and compare these outcomes to efficient outcomes to show the relative efficiency of various policy approaches. We find substantial differences in biodiversity conservation scores generated by simple voluntary incentive-based policies and efficient solutions. The performance of incentive-based policies is particularly poor at low levels of the conservation budget where spatial fragmentation of conserved parcels is a large concern. Performance can be improved by encouraging agglomeration of conserved habitat and by incorporating basic biological information, such as that on rare habitats, into the selection criteria.     

Patterns of multi-agent land conservation: Crowding in/out,agglomeration, and policy

Private agents make large contributions to networks of conserved land, but little is known about how private agents’ decisions might be altered by government actions. This paper explores the impact of public conservation and public policy on the quantity and configuration of private land conservation and the extent to which the social optimum is reached. Because land conservation benefits often have thresholds and spatial characteristics, we consider the impact of different land conservation benefit functions on the patterns of conservation created by the interaction of private and public agents. We find that public conservation crowds private conservation in or out depending on whether marginal conservation benefits increase or decrease with total acreage, and crowding out is mitigated by the presence of budget constraints. We show how land conservation agents might interact strategically in space depending on preferences over fragmentation, and we explore that spatial strategic interaction in a case with a regional land trust and a case with hot-spot parcels. We identify when government policies, such as agglomeration bonuses and mitigating coordination costs, are most likely to increase the social benefits provided by private land conservation agents.     

Diagram for a small planet: The Production and Ecosystem Possibilities Curve

With the development of the GPI there is now an ecological alternative to GDP for measuring a country's economic performance, but we still lack an ecological alternative to the PPC for illustrating a country's economic problem. The diagram suggested here illustrates a country's production and ecosystem possibilities — including climate stability, flood control, carbon sequestration, aquifer recharge, scenery, recreation, biological diversity, and so on. Burning a rainforest to clear the land shifts a country's PPC outward, giving the visual impression of an unmitigated improvement; but such development causes a movement along the country's PEPC, as ecosystem services are transformed into GDP. The slope of the PEPC is the marginal rate of transformation, which equals the ratio of the land's marginal marketable product to its marginal ecosystem product. Changes in technology create substitution and income effects that help explain the enclosure movement and the environmental Kuznets curve. Much as employment of the human resource can be restrained to allow more leisure, development of the natural resource can be restrained to preserve more ecosystem services. Commercial lobbying interests and rivalries for positional goods create distortions that move a country along its PEPC to a materialistic misallocation, with too little conservation. An idealistic misallocation is also possible, with too much preservation of the natural environment. Small is beautiful, up to a point, and that is evident in this diagram. Jacob Viner's [Viner, J., 1937. Studies in the Theory of International Trade. Harper and Brothers, New York] analytical objections to the PPC are revived.     

Production subsidies and redistribution

Who gains from stimulating output? We explore a dynamic model with production subsidies where the population is heterogeneous in one dimension: wealth. There are two channels through which production subsidies redistribute resources across the population. First, poorer agents gain from a rise in wages, since—to the extent there is an operative wealth effect in labor supply—they work harder. Second, because a current output boost will raise consumption today relative to the future, thus lowering real interest rates, poor agents gain in relative terms since their income is based less on interest income. We examine optimal redistribution from the perspective of an arbitrary consumer in the population. We show that, if this consumer has commitment at time zero to set all present and future subsidy rates, and for a class of preferences that admits aggregation in wealth, then output stimulation, and hence redistribution, will only occur at time zero; after that, subsidies are zero. A byproduct of our analysis of this environment is a median-voter theorem: with direct voting over subsidy sequences at time zero, the sequence preferred by the median-wealth consumer is the unique outcome. We also study lack of commitment, since interest-rate manipulation is associated with time inconsistency. We analyze this case formally by looking at the Markov-perfect (time-consistent) equilibrium in a game between successive identical decision makers (e.g., the median agent). Here, subsidies persist—they are constant over time—and are more distortionary than under commitment. Moreover, whereas under commitment asset inequality changes initially—in favor of the consumer who decides on policy—it does not under lack of commitment.     

Effectiveness and cost-effectiveness of yellow-eyed penguin recovery

Although an estimated US$6 billion is invested annually in our planet's biological diversity, little research has been conducted on which conservation treatments work best or provide best value for money. Where controlled experiments are not possible, econometric techniques can be used to determine the effectiveness of conservation treatments. We use a long-running yellow-eyed penguin (Megadyptes antipodes) nest count in New Zealand to compare the effectiveness and cost-effectiveness of three commonly used endangered species recovery treatments—trapping of introduced predators, revegetation, and intensive management. Following ecological theory, we specify a density-dependent population growth rate. We control for year effects and site characteristics such as land cover, slope, and elevation. The possibility of selection bias in treatment is confronted with site fixed effects and with an instrumental variable based on site accessibility. Of the three treatments that we analyze, only intensive management is significantly correlated with increases in annual site-level yellow-eyed penguin population growth rate. We estimate that intensive management increased the yellow-eyed penguin population by 9% above the counterfactual, and that the average cost of producing an additional yellow-eyed penguin nest through intensive management is NZ$68,600.     

Using GIS-based ecological–economic modeling to evaluate policies affecting agricultural watersheds

This paper has three purposes. The first is to conceptualize agricultural watersheds as complex adaptive human ecosystems that co-produce agricultural goods and ecosystem services. The second is to demonstrate a generalizable framework for the spatial modeling of ecosystem service production in watersheds based on this conceptualization. The third is to examine the policy implications of the analysis conducted using this spatial decision support system (SDSS).Analyses using the SDSS show that restrictions on soil loss to the “tolerance level” (T) cause average farm income to decline by only 4%, a reduction that is nearly eliminated if the Conservation Reserve Program (CRP) is available to farmers as an income-generating alternative. The spatially variable response of farmers to soil loss restrictions and the CRP creates a complex pattern of winners and losers and a markedly different land use pattern and crop mix than occurs without these programs. The land use pattern associated with T restrictions and the CRP yields about 64% lower erosion rates and 43% lower sediment yields than the pattern without T restrictions or CRP. These and other results from the SDSS analysis point out that ecosystem service-based subsidies, such as CRP, improve the joint production of farm income, soil conservation and water quality in agricultural watersheds. These subsidies could perhaps receive greater funding by shifting agricultural subsidies from income supports tied to yield and price as well as other crop-based programs. In this way, public expenditures on agriculture would produce a valuable public benefit in the form of load reductions in a TMDL context, and an augmentation of ecosystem services now in decline in many agricultural watersheds. Further methodological developments now underway using evolutionary algorithms can find near-optimal solutions for farms over time and for landscape patterns over whole watersheds.     

Agri-environmental policies for biodiversity when the spatial pattern of the reserve matters

The aim of this paper is to compare different environmental policies for cost-effective habitat conservation on agricultural lands, when the desired spatial pattern of reserves is a random mosaic. We use a spatially explicit mathematical programming model which studies the farmers' behavior as profit maximizers under technical and administrative constraints. Facing different policy measures, each farmer chooses the land-use on each field, which determines the landscape at the regional level. A spatial pattern index (Ripley L function) is then associated to the obtained landscape, indicating on the degree of dispersion of the reserve. We compare a subsidy per hectare of reserve with an auction scheme and an agglomeration malus. We find that the auction is superior to the uniform subsidy for cost-efficiency. The agglomeration malus does better than the auction for the spatial pattern but is more costly.     

Bonus pay for teachers,spatial sorting,and student achievement

Bonus pay policy for teachers in the U.S. is analyzed in this paper. We quantitatively argue that, because of the decentralized education finance system in the U.S., this policy may lead to higher teacher and household sorting across school districts. This then may lead to higher variance of achievement and lower mean achievement. Formally, we use an equilibrium political economy model of education at which households, heterogeneous in exogenously set income, and teachers, heterogeneous in exogenously set quality, are endogenously allocated across two school districts. Public education expenditures, which includes teachers’ wage payment and non-teacher related education spending, are financed through local income taxation. Income tax rate in each district is determined via majority voting. Achievement depends on the efforts chosen by teachers and non-teacher related education spending. Teacher efficiency wage per unit of quality is determined at the national teacher labor market. We first calibrate our benchmark model by matching certain statistics from the U.S. data. Then in a computational experiment, we introduce bonus pay for teachers which rises with average achievement. We find that for the recently observed level of average bonus pay (6.59% of average base salary), variance of achievement is 2.46% higher and mean achievement is 1.79% lower than the benchmark. Variance of achievement reaches its peak when average bonus pay is 14.06% and then it starts falling. Also, mean achievement always falls as average bonus pay rises.     

Farming system modelling for agri-environmental policy design: The case of a spatially non-aggregated allocation of conservation measures

This paper addresses the issue of designing policies for habitat conservation on agricultural land. The case under study requires a non-aggregated spatial distribution of the fields to be enrolled in an agri-environmental programme. A spatially explicit mathematical programming farm-based model, which accounts for three spatial levels (field, farm and landscape), is coupled with a relevant spatial pattern index (the Ripley L-function) to analyse the design and implementation of an agri-environmental programme aimed to preserve the Tetrax tetrax in the Plaine de Niort, France. The model is run using a stylised map with heterogeneous soil types and both crop growing and mixed dairy farms. Results show that valuable insights into agri-environmental programme design are gained through a detailed representation of farming system management. The suitable, non-aggregated spatial pattern for T. tetrax conservation is more costly than less-suitable, more aggregated patterns, because it tends to require equal participation of all farms. The policy simulations reveal that the various spatial patterns can be obtained through relatively simple uniform contract structures. An effective contract structure entails a set of two degressive payments which encourages all farms to enrol at least a small share of their land in the program.     

Applying input-output analysis to scenario analysis of ecological footprints

Application of input-output analysis to ecological footprints (EFs) is shifting from an ex-post static calculation toward an ex-ante scenario analysis for enhancing the policy relevance of EF analysis. This change in application prompts two issues requiring careful examination: (1) what is measured by Leontief inverses or extended environmental Leontief inverses, and (2) whether a sector's land multiplier (or compositions of land multiplier) can appropriately reflect the effect of delivering one unit of the sector's output to final demand on the required area(s) of production lands used by the sector itself and by other producing sectors whose products are contributed directly and indirectly to its production. The underlying message of these two questions is whether the assumed linear marginal relationship between a sector's output and its intermediate inputs (input-output coefficients)—a critical assumption made by W. Leontief to transform a transactions table from an accounting framework into the input-output model—can be extended to assume that the marginal relationship between a sector's output and the area of production land it uses for generating output is fixed (land-output marginal coefficient equal to average coefficient). By reviewing the literature on input-output analysis and its application to environmental issues and by theoretically and empirically examining the relation between sector output and land appropriation, this study advises against the use of land multipliers or their compositions in the EF scenario analysis.To apply the input-output model to EF scenario analysis for enhancing policy relevance with due attention to the relationship between sector output and land appropriation, this study suggests a two-stage EF calculation procedure. In the first stage, the input-output application estimates only the required raw materials (or generated pollutants) for meeting a given consumption pattern, which is the objective of environmental input-output analysis; in the second stage, the estimated amount of raw materials or pollutants is converted into land/water area, and a choice of conversion methods is suggested according to the research questions and the availability of conversion methods and required data.     

Optimal taxation with joint production of agriculture and rural amenities

We show that, when there is joint production of an agricultural good and rural amenities, the first-best allocation of resources can be implemented with a tax on the agricultural good and some subsidies on the production factors (land and labor). The use of a subsidy on the agricultural good can only be explained by the desire of the policymaker to redistribute income from the consumers to the farmers.     

Basin impacts of irrigation water conservation policy

Climate change, uncertain future water supplies, growing population, and increased water demands continue to raise the importance of finding cost-effective water conservation measures. Irrigated agriculture is the world's largest water user, so governments, donor organizations, water suppliers, and farmers continue to look for measures that would produce more crop per drop. Despite the importance of promoting water conservation in agriculture, little work has been done that integrates hydrologic, economic, institutional, and policy dimensions of water conservation. This paper presents an integrated basin scale analysis of water conservation subsidies for irrigated agriculture. A dynamic, nonlinear programming model is developed and applied for the Upper Rio Grande Basin of Colorado, New Mexico, and Texas, USA. Several potential public subsidies of drip irrigation are analyzed for their economic and hydrologic impacts at both the farm and basin levels. Results indicate that water conservation subsidies for drip irrigation produce several effects. These include greater on-farm implementation of water-conserving technology, less water applied to crops, more water consumed by crops, increased farm income, greater crop production, more land irrigated, and increased total water-related economic benefits for the basin. Findings provide a framework for designing and implementing water conservation policies for irrigated agriculture.     

Additionality When REDD Contracts Must be Self-Enforcing

This paper examines self-enforcing contracts as a financial mechanism for reducing carbon emissions from deforestation and forest degradation when the opportunity cost of the land (i.e., landholder type) is private information and is imperfectly correlated over time (i.e., partially persistent types). Because self-enforcement limits the feasible incentives, the conservation levels are constrained by the surplus created. Regardless of the degree of persistence of such opportunity costs across contracting periods, a first-best self-enforcing contract can deliver “additional” carbon sequestration beyond the business as usual scenario only if the value of forest conservation is sufficiently high. Otherwise, self-enforcing contracts can induce some, suboptimal level of carbon sequestration. The degree of persistence of opportunity costs across periods does not affect the amount of total payments provided in the optimal menu of contracts, but greater persistence of opportunity cost types leads to contracts that feature more of the total payment as a bonus in contracts for landholders with a high opportunity cost for their land and more of the total payment as an upfront fixed payment for landholders with a low opportunity cost.     

Biodiversity value and the optimal location of forest conservation sites in Southern Finland

Safeguarding biodiversity has been one of the most important issues in environmental and forest policies since the 1990s. In Southern Finland, decisions concerning further actions for the preservation of forest biodiversity will be made in the coming years. To support policy making, we present a multi-regional model that is applicable in determining the economically optimal regional allocation of conservation sites. Three habitat quality models are evaluated to calculate habitat quality indices used as a surrogate for a biodiversity value in a forest sector model. The scenarios presented provide information about the economic impacts of conservation choices on the forest sector. The overall economic impacts of conservation depend on its scale and regional allocation. Conserving land with high biodiversity value can have less adverse impact on the forest sector than conservation of typical commercial forest sites. When optimizing conservation set-asides, we found that set-asides targeted to certain regions possessing higher/lower than average relative share of ecologically valuable land, caused lower/higher adverse economic impacts on the forest sector. Because it is expensive to search land suitable for conservation, these regions could be respectively favoured/avoided when asking forest owners to offer their land for the new conservation program in Southern Finland, which will be based on voluntariness.     

Farmers' preferences for crop variety traits: Lessons for on-farm conservation and technology adoption

Although in-situ conservation is increasingly considered an efficient way of conserving plant genetic resources, little is known about the incentives and constraints that govern conservation decisions among small farm holders in developing countries. Using a choice experiment approach, we investigated Ethiopian farmers' crop variety preferences, estimated the mean willingness to pay for each crop variety attribute, and identified household-specific and institutional factors that governed the preferences. We found that environmental adaptability and yield stability are important attributes for farmers' choice of crop varieties. Farmers are willing to forego some extra income or yield to obtain a more stable and environmentally adaptable crop variety. Among other things, household resource endowments (particularly land holdings and livestock ownership), years of farming experience, and contact with extension services are the major factors causing household heterogeneity of crop variety preferences. Based on our experimental results, we derived important policy implications for on-farm conservation, breeding priority setting, and improved variety adoption in Ethiopia.     

Costs and benefits of on-farm nature conservation

The costs of on-farm nature conservation is an important issue in Dutch agriculture. As nature is a public good, nature conservation cannot do without subsidies from the government. The question of how much farmers should receive in subsidies in order to keep farms engaged in conservation activities is highly topical. In this article, the questions of how much farmers should receive in subsidies and what other factors motivate or demotivate farmers to participate in on-farm nature conservation are addressed. The study was carried out for a particular region in the northern Netherlands and was initiated by the concerns that farmers organisations had about the level of subsidies for landscape conservation as a major form of nature conservation on dairy farms in this region.In this study, both a normative model and a survey were employed. A normative economic dairy farm model was first used to determine differences in income between a typical farm involved in landscape conservation and a typical farm not involved in landscape conservation. Results from the model show that the farm involved in conservation earned a lower income than the farm not involved in conservation. This was due to the first farmer's smaller scale, lower intensity and lower productivity. The lower income, however, was compensated for by conservation subsidies. Next, a survey concerning on-farm nature conservation in general was carried out among the farmers in this area. From the survey results, it appeared that the majority of the respondents were satisfied, at least to some extent, with the level of subsidies for on-farm nature conservation. Moreover, the survey also revealed that the farmers' commitment to their natural environment strongly motivates farmers to get involved in on-farm nature conservation schemes, whereas the uncertainty about regulations and the feeling of being controlled too much demotivate them.The results show the complementarity of the two methods. The findings of the survey confirm the main findings of the normative model calculations, and, moreover, the survey reveals that in addition to monetary compensation, other factors play a role for farmers in the decision to get involved in on-farm nature conservation.     

An agglomeration payment for cost-effective biodiversity conservation in spatially structured landscapes

Connected habitats are ecologically more valuable than isolated habitats for many species. A key challenge when designing payments for biodiversity in fragmented landscapes is to increase the spatial connectivity of habitats. Based on the idea of an agglomeration bonus we consider a scheme in which land-owners only receive payments if habitats are arranged in an ecologically favourable configuration. We compare the cost-effectiveness of agglomeration payments to spatially homogeneous payments on a conceptual level. Our results suggest that positive efficiency gains exist for agglomeration payments. We use Large Blue butterfly habitat in Germany as a specific case study, and find the agglomeration payments may lead to cost-savings of nearly 70% relative to homogenous payments.     

A dynamic approach to PES pricing and finance for interlinked ecosystem services: Watershed conservation and groundwater management

A theory of payment for ecosystem services (PES) pricing consistent with dynamic efficiency and sustainable income requires optimized shadow prices. Since ecosystem services are generally interdependent, this requires joint optimization across multiple resource stocks. We develop such a theory in the context of watershed conservation and groundwater extraction. The optimal program can be implemented with a decentralized system of ecosystem payments to private watershed landowners, financed by efficiency prices of groundwater set by a public utility. The theory is extended to cases where land is publicly owned, conservation instruments exhibit non-convexities on private land, or the size of a conservation project is exogenous. In these cases, conservation investment can be financed from benefit taxation of groundwater consumers. While volumetric conservation surcharges induce inefficient water use, a dynamic lump-sum tax finances investment without distorting incentives. Since the optimal level of conservation is generated as long as payments are correct at the margin, any surplus can be returned to consumers through appropriate block pricing. The present value gain in consumer surplus generated by the conservation-induced reduction in groundwater scarcity serves as a lower bound to the benefits of conservation without explicit measurement of other benefits such as recreation, biodiversity, and cultural values.     

我国金融业空间集聚的区域分异及其特征——基于非线性傅立叶单位根检验的分析简

金融业集聚对于区域经济的发展有着重要作用。对我国31个省份1978—2011年金融业区位商进行非线性傅立叶单位根检验,将检验结果与区位商均值相结合,分东、中、西三地区对金融业空间集聚的区域分异及其特征进行对比分析。结果表明,东部地区的集聚水平要高于中、西部地区,各省份的金融业集聚水平大体呈橄榄形分布,同时,三地区大部分省份金融业集聚的单位根检验结果都体现出不稳定特征,说明我国金融业的空间集聚格局一直处于不断调整之中。而这种调整在一定程度上有利于实现金融资源的优化配置。     

土地承载力与经济发展的动态效应和耦合协调*——基于京津冀城市群的实证研究

本文运用2000—2014年京津冀城市群面板数据,构建土地综合承载力与区域经济发展的PVAR模型,分析土地综合承载力、人均GDP、地均第二、第三产业增加值之间的动态影响效应;构建两者的耦合协调评价模型,实证解析土地综合承载力与区域经济发展的耦合协调程度。结果表明：（1）土地潜在综合承载力的挖掘能促进区域经济发展的水平增加和结构优化;（2）土地综合承载力、人均GDP、地均第二、第三产业增加值波动均受其自身变动冲击的影响最大;（3）两者的耦合协调度较低,从中度失调向轻度失调,再向勉强协调,然后向中度协调过渡。