The Cost Effectiveness of the U.S. Export Enhancement Program Bonus Allocation Mechanism

The U.S. Export Enhancement Program is evaluated from the perspective of the cost effectiveness of its bonus allocation mechanism. The current mechanism resembles a discriminatory-price, common-value auction. However, auction theory suggests that a discriminatory auction may not be optimal in this setting for several reasons. This article evaluates the current format relative to an alternative, uniform-price auction. Estimation results reveal evidence of strategic bidder behavior under the current format and simulations suggest that adopting a uniform-price auction format for bonus allocation may yield considerable savings to the Treasury by eliminating incentives to pad bids and increasing participation in the auction.     

Multifunctionality of agriculture: an inquiry into the complementarity between landscape preservation and food security

Without support, the levels of agricultural public goods suchas food security and landscape preservation would fall shortof demand in high-cost countries. However, as demonstrated byNorway as a case study, the current level of support is disproportionatefrom a public goods perspective, and the policy instrumentsare badly targeted at the public goods in question. Becauseagricultural land is a major component of both food securityand landscape preservation, giving rise to a high degree ofcost complementarity between the public goods, it would be moreefficient to support land-extensive production techniques thanproduction per se.     

Optimal conservation investment for a biodiversity‐rich agricultural landscape*

This study develops a theoretical and empirical framework for optimal conservation planning using satellite land cover data and economic data from a farm survey. A case study is presented for a region within the South‐west Australia Biodiversity Hotspot (Nature 403, 853). This Biodiversity Hotspot is a focus for conservation investment as it combines a relatively high level of biodiversity with severe threat to the biodiversity from agriculture. The conservation planning model developed determines the optimal set of bush fragments for conservation. This model can also be used to assess the trade‐off between the budget and a vegetation species metric. Results from the case study show that, without an effective conservation scheme that at least fences fragments, significant plant biodiversity losses will occur in the North East Wheatbelt Regional Organisation of Councils region of the WA wheatbelt over a 10‐year period. A perfect price discriminating auction scheme could reduce the costs of conservation by around 17 per cent relative to a fixed‐payment scheme; however, a fixed payment on outcome (measured as change in the species metric) scheme represents a viable second‐best alternative, to a conservation auction, where conservation spending is spatially targeted.     

Market Performance of Potato Auctions in Bhutan

Abstract

Market performance with respect to a main horticultural export commodity in Bhutan is the subject of this paper. Imperfections in (market) infrastructure and market structure and conduct may prevent an optimal price for farmers. Market performance is assessed by testing the law of one price for this commodity. This is done by testing three series of auction price data on both long-run and short-run price integration. It is concluded that for the period 1996-2000 the auction prices were interrelated both in the long and short run with one of the three auctions as the price-leading market. In contrast, in the period 2001-2005 the market arbitrage process slowed down, indicating the rise of market imperfections. Policy implications are suggested.     

How well do conservation auctions perform in achieving landscape‐level outcomes? A comparison of auction formats and bid selection criteria

This paper studies the performance of auction design features regarding pricing mechanisms and bid selection criteria for securing wildlife zones across different holdings. We compare two pricing mechanisms: a discriminatory‐price auction and a uniform‐price ascending auction, and four bid selection criteria on the basis of: total bid, bid‐per‐value ratio, bid‐per‐area ratio and a mixed criterion where bids are formed on the basis of cost but they are selected based on the bid‐per‐value ratio. We develop a best‐response group‐bidding model for a discriminatory‐price auction where bidders form optimal group bids for individual wildlife zones. In the uniform‐price ascending auction, individual landholders respond to prices, which are successively raised by the auctioneer and whenever all the landholders from a single zone agree to participate (i.e. the first zone is formed), the auction stops. Based on numerical simulations using a bio‐economic model of malleefowl conservation, we observe that the discriminatory‐price auction is more cost‐effective than the uniform‐price ascending auction. However, the budgetary cost‐effectiveness of a discriminatory‐price auction is sensitive to bidder uncertainty about the number of competing bidder groups and the highest cost of establishing a wildlife zone among these groups. In terms of bid selection, the mixed bid selection criterion performs best. We discuss the policy implications of these findings.     

Auctions with and without the Right of First Refusal and National Park Service Concession Contracts

The National Park Service has struggled to improve the quality of service provided by concessioners for decades. To address these concerns, the Park Service eliminated the right of first refusal from the largest revenue-generating concession contract auctions beginning in 2000. This article provides models of concession contract auctions with and without the right of first refusal. The optimal bidding strategies and expected level of service are found. The results confirm the auction without the right of first refusal leads to bids that include a higher level of service.     

活立木交易的最优拍卖竞价研究——基于买方估价和两人竞购的视角

首先阐述了活立木现行交易的基本方式和在交易中活立木定价失真的缺陷,其次通过分析拍卖的优势提出活立木交易中拍卖定价方式。接着介绍了活立木交易中的主体,同时分析了竞买人双方在不同博弈策略和估价策略下的收益。在此基础上建立两人竞购的最优拍卖机制,以简单的概率分析描述竞买人的决策,以买方估价和最大化卖方的期望收益为前提,确定交易价格,得出最优拍卖竞价使得买方总期望收益的增长、使交易公开透明、物品配置合理等优势。     

The grain potential of cultivated lands in Mainland China in 2004

The regional test yields of certificated cultivars of grain crops represent the potential yields for the given region under the current natural and technical conditions. Therefore, it is appropriate to use the regional test yields to estimate the gross grain potential of Mainland China.In this paper, we calculated the grain potential of cultivated lands for each of the 105 agro-ecological regions in China. First, cropping system in each agro-ecological region was assumed to be the best use of the agro-climatic resources. Second, the potential per hectare for each of the crops was calculated for a given agro-ecological region, based on the regional test yields of certificated cultivars of grain crops in a given cropping system. For rain-fed and dry lands, their grain potentials were further modified by water-restricting coefficients. The water-restricting coefficients were calculated by dividing the hydro-thermal potential with the corresponding photosynthesis-thermal potential for different grain crops, which were obtained from Regulations of Farmland Grading. Thereafter, the grain potential per hectare of each agro-ecological region was calculated considering the cropping system and the potentials per hectare of all the crops in the cropping system. The gross grain potential of each county in a given region was then obtained by multiplying the grain potential per hectare and the total area of cultivated lands in the county. Finally, the gross grain potential of each agro-ecological region and the whole Mainland China were obtained by summarizing the grain potentials for all of the counties. The results showed that the gross grain potential of Mainland China was 0.92 billion t in 2004. It should be pointed out that this calculation on the grain potential did not sufficiently consider the crop growth restricting factors of cultivated lands, such as soil fertility, fertilizer input, and so on. Since the grain potential is far above the actual grain yield, it suggests that the cultivated land assurance for grain security in Mainland China is relatively high. The results of each agro-ecological region showed that the highest grain potentials were distributed in Huang-Huai-Hai Plain, Northeast China, Middle and Lower Reaches of Yangtze River and Sichuan Basin, where excellent hydro-thermal condition and flat terrain are ideally suitable for crop growth.     

Does It Pay to Increase Competition in Combinatorial Conservation Auctions?

Conservation auctions allow landholders to propose conservation projects and associated payments (bids) for consideration by a conservation agency. Recently, the application of iterative combinatorial auction designs has been proposed to improve outcomes of conservation auctions. In combinatorial auctions, landholders are allowed to offer projects each of which involves activities aimed at providing one or multiple services. An iterative format allows bidders the opportunity to gradually explore the type of projects they want to offer, with this process being facilitated through price feedback provided based on intermediate auction round results. Auction designs vary with the type of feedback and respond differently to market conditions. At present there is a lack of information about their performance in markets with varying degrees of competition (in terms of number of bidders and level of target). Therefore, using an agent‐based simulation model, we evaluate a number of iterative auction designs. We observe that a higher degree of competition leads to a higher auction efficiency. In a high competition environment, efficiency outcomes tend to be less sensitive to auction design choices. Therefore, an auctioneer could enjoy freedom in design choice if adequate competition could be ensured. In weak competition environments, however, some auction designs perform better than others.     

Comparing a best management practice scorecard with an auction metric to select proposals in a water quality tender

The focus of this paper is to compare different evaluation frameworks for selecting landholder proposals to improve water quality. The case study is a water quality tender performed in the Burdekin region in Northern Australia in 2007/2008 where bids could be assessed using an inputs-based best management practice scorecard or an outputs-based auction metric. The scorecard approach and other variants of multi-criteria analysis are commonly applied in grant schemes, where landholder proposals are rated by a range of inputs-based criteria. Output-based approaches are typically applied in water quality and conservation tenders, where an environmental benefits index is constructed to summarise the environmental improvements generated by each proposal. These then allow projects to be selected on the basis of cost effectiveness. The case study evaluation reported in this paper demonstrates that the input focus of multi-criteria analysis type assessments are flawed, and that the efficiency of public funding can be more than doubled using auction metrics to assess proposals for landholders to improve water quality.     

The Impact of Cereal Prices and Policy on Crop Rotations and Supply Response

The impact of cereal prices on rotational decisions and farm‐level and industry cereal supply is considered. It is argued that with the voluntary 50 per cent set‐aside option for cereal producers, there is a large financial incentive to adopt a 50 per cent set‐aside cropping plan as cereal prices fall below an individual producer's ‘indifference’price. For a typical 210‐hectare UK combinable crop farm, adopting a 50 per cent set‐aside cropping plan is optimal when the price of cereals is below £62/tonne (98.50/tonne). If widely adopted, 50 per cent set‐aside will lead to a substantial fall in the supply of cereals and would lead the industry supply curve for cereals to move leftward and become more elastic over a certain price range. The level of reduced cereal supply will be greater than would be predicted from an estimate of industry level supply response that ignored rotational and farm‐level financial incentives.     

Effect of conserving habitat for biodiversity on optimal management of non-industrial private forests in Florida

Healthy forests and enhanced habitat for wildlife is a growing concern among public and policy makers. These concerns have led to substantial interest in promoting various regulatory and voluntary compliance policies to further biodiversity on private forests. These policies, however, might result in additional cost to forestland owners. In this paper, we estimate the opportunity cost of adopting various biodiversity-friendly forest practices. We do this in the context of slash pine, a dominant commercial tree plantation species in Florida. Results suggest that prescribed burning, invasive species control, maintaining streamside buffer zones, and extending timber harvest beyond the optimal rotation age would significantly decrease the profitability of slash pine forestry. If the major objective of landowners is to maximize profits, results indicate that they are less likely to adopt these practices at socially desirable levels without a policy support. More specifically, results suggest that an annual payment of $38–83 per hectare is required for landowners to adopt these practices. The paper further argues that application of mere command-and-control approaches to implement these practices may result in conversion of private forests to other competitive land uses.     

农区林地使用权分配模式的选择

农区林地国家所有的前提下,林地使用权采取了分户承包、个别农户承包、农户管护承包、拍卖和反租倒包等分配模式,这些分配模式下农区仍存在宜林地利用率不高、林权模糊导致的林权残缺、采伐限额影响林地使用者收益预期等问题。在明确林地界区、划分为公益林地和商品林地的前提下,林地使用权的分配可选择公益林地预留、商品林地混合分配模式。     

高地价对中国土地储备制度的冲击

研究目的:分析并解释高位运行的城市土地价格对我国土地储备形成冲击的表现及作用机制。研究方法:实证分析法、因果分析法。研究结果:高位运行的土地价格引发开发商、政府和城市居民等主体行为变异,从而对土地储备制度产生冲击。研究结论:从引导需求、规范行为、加强监管、完善制度本身建设等方面着手,抑制地价过度上涨,发挥土地储备制度作用。     

海南省最优森林生态规划研究

在对国内外生态规划研究综述的基础上,通过对海南省最优森林生态规划的研究指出:要使海南省林地、林木和森林环境服务的效益最大,必须调整用材林、防护林、特用林和竹林的面积比例。海南省不同林种林地合理使用的平均影子价格为2512.46元/hm2,特用林的最优估价为4376.04元/hm2。建议,海南省应减少用材林面积的比例,增加防护林面积的比例,围绕生态省的建设,狠抓林种结构调整,使不同林种比例结构适合生态省建设的需要。同时,要注重林业产业结构的调整,使林业生产主要由单一热带作物生产转移到多种林产品生产和服务上来,注重林业优势产业的发展。     

Impact of Purchase Intentions on Full and Partial Bids in BDM Auctions: Willingness‐to‐pay for Organic and Local Blueberries

We conduct a series of Becker–DeGroot–Marschak (BDM) auctions to elicit consumers' willingness‐to‐pay (WTP) for organic and local blueberries. Participants' intentions to purchase the auction product were collected to determine how purchase intentions for the auction products affect their partial bids (WTP for an additional attribute) as well as full bids (WTP for the auction product). The results suggest, as expected, that full bids from participants with purchase intention for the auction product are significantly higher than those from participants without purchase intention. However, the partial bids, which are inferred from the full bids, for organic and local attributes are consistent across participants with different purchase intentions. Therefore, if the focus of a BDM auction is consumers' WTP for product attributes, purchase intentions may not be an important influence on the value.     

The Usefulness of Experimental Auctions in Determining Consumers' Willingness-to-Pay for Quality-Differentiated Products

The validity and effectiveness of using experimental auctions to elicit consumers' willingness-to-pay for closely related, quality-differentiated products is examined. The effect of panelists' demographics on bid values and auction winners, and the impact of experimental procedures on auction prices are analyzed. Demographic variables are poor predictors of bids and auction winners. Experimental procedures such as panel size and initial endowment influence market price level. Relative bid differences for paired samples are primarily influenced by relative differences in taste panel ratings. Relative willingness-to-pay values elicited through experimental auctions appear valid, while actual willingness-to-pay values are influenced by experimental design.     

Exploring the cost effectiveness of land conservation auctions and payment policies*

This article evaluates the cost‐effectiveness of the Catchment Care Australian conservation auction. It provides evidence of auction cost effectiveness, and estimates cost savings from two discrete components: (i) the opportunity cost revelation incentive provided by the auction mechanism, and (ii) the improved environmental targeting capacity that results from development of a scientifically based environmental benefits assessment capacity. Results show that there are potentially very large returns associated with the latter component that have been overlooked in the literature. Additionally, transaction costs involved with administering the case study conservation auction and the prior non‐auction payment policy are compared. We find that the administration costs for the auction were greater than or equal to those associated with the prior policy. Estimates of relative cost effectiveness across policies are shown to be sensitive to the methods of comparison. In this case study, there is inelastic supply of the last units of environmental benefit. This inelasticity results in large estimated auction comparative cost advantage when the benefit metric is the estimated cost required to achieve auction aggregate environmental benefit. Estimated benefit of the auction is much less when measured as environmental benefits attainable with alternative payment policies subject to the auction budget constraint.     

The impact of climate change on the external cost of pesticide applications in US agriculture

Agricultural pesticides have adverse impacts on the environment and human health. These impacts are sensitive to climate change because pest pressure and optimal pesticide application rates vary with weather and climate conditions. This study uses the Pesticide Environmental Accounting (PEA) tool and statistically estimated relationships between pesticide applications, weather and climate to compute the impacts of climate change on the external cost of pesticide applications. Using data from 32 US states, 56 crops and 325 pesticides, the current average external cost of pesticide use in US agriculture is calculated at US$42 per hectare. Under projected climate change this value increases up to $72 per hectare by 2100.     

An experimental examination of target based conservation auctions

Conservation auctions are increasingly employed to increase the provision of Ecological Goods and Services (EG&S) for achieving environmental goals. Most applications of conservation auctions concern the efficient allocation of a fixed conservation budget. However an important and under-explored application of conservation auctions is in meeting environmental targets, either as part of regulatory compliance by industry or by governments in meeting specified policy objectives. This paper examines the ability of a conservation auction to meet an environmental target. We use experimental economics methods benchmarked to a wetlands restoration case study to examine bidder behavior and efficiency in both budget constrained and target constrained auctions when landowners with increasing marginal costs can offer increasing sized bundles of wetland acres. The target constrained auction is characterized by an all or nothing rule, where there is no payout if the target is not met. We find that rent seeking and average cost in the target constrained auction is less than in a budget constrained auction, but that efficiency eroded in repeated rounds suggesting learning effects as participants realize there is no budget cap. Even with learning effects the target based auction out-performs the budget based auction. Adding a reserve price to the target based auction significantly reduced rent seeking but also increased the probability that the target was not met. The results have important implications for auction design in real world settings.