An overview of laboratory research on conservation auctions

This paper reviews the laboratory research on conservation auctions by first suggesting a framework for organizing the literature; then by highlighting the key insights and contributions achieved to date; and thirdly by taking stock of pending questions and unresolved problems. The review framework focuses on the performance of conservation auctions and distinguishes between causal factors and resulting effects. Causal factors include auction format, implementation rules and bidder characteristics, as well as some other aspects. Resulting effects distinguish between intermediate effects, mainly in terms of bidder behaviour, and final auction performance. Rather than a standard literature review, this ‘overview’ also tries to capture the work that is currently going on and that has not yet been published.     

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.     

An experimental approach to valuing new differentiated products

An experimental store was created to evaluate initial demand for locally produced and guaranteed tender steak products as a more realistic alternative to contingent valuation (CV) and dichotomous-choice experimental methods. Strengths of the approach are incentive compatibility, a realistic consumption set, and a familiar choice environment. Consumers selected among USDA Choice, premium quality, lean, guaranteed tender and locaily produced strip steaks. A double-hurdle count data model indicated initial willingness-to-pay (WTP) for locally produced steak comparable to prior CV results, but demand was highly elastic. Demand for premium quality steak crowded out demand for the guaranteed tender product, contrasting with prior dichotomous-choice experimental results.     

Tracking 130 years of coastal wetland reclamation in Ria Formosa,Portugal: Opportunities for conservation and aquaculture

Economic activities in coastal wetlands are often perceived as incompatible with nature conservation. This negative perception stems from the visible impacts resulting from a continuous process of coastal wetland reclamation, as human pressure increases significantly in global coastal areas. The largest coastal wetland area in southern Portugal, the Ria Formosa, shares a similar perception, where current nature protection status often conflicts with the needed economic development. Here we explore how the economic activities influenced the wetland reclamation process in Ria Formosa, addressing namely aquaculture identified as an activity with a significant compatibilization potential. Different datasets were merged in a Geographical Information System, tracking land use change in Ria Formosa wetlands over the last 130 years at decadal intervals. Our results show that since the end of the 19^th century nearly 2000 ha of wetlands were converted to anthropic environments, resulting in a 20 % natural area reduction. From 1885 until the mid-20^th century, land use policy was influenced by the significant regional seafood preservation industry, with large swaths of wetlands diked, drained and excavated to give place to traditional salt farms. The following economic downturn gave place for the late industrialization of salt farms, further increasing the reclaimed wetland areas, later stalling with the recognition of the environmental importance of Ria Formosa in 1978. Aquaculture only gained momentum in 1980’s with the support of European funding, resulting in the conversion of many unproductive diked areas. However, late 20^th century and current land use policy shifted to a nature conservation focus, therefore limiting the use of previously reclaimed areas, a challenge that influenced the abandonment of the modified areas. By studying the long-term change of land use in Ria Formosa, we argue that in high conservation value areas new policies should be considered that stimulate the development of an ecosystem approach to economic activities, namely aquaculture, improving simultaneously the regional environmental status and socioeconomic sustainable development.     

Information and consumer willingness to pay for biofortified yellow cassava: evidence from experimental auctions in Nigeria

In this article, we use the Becker‐DeGroot‐Marschak mechanism to estimate consumer demand for biofortified yellow cassava varieties in two states of Nigeria: Imo in the southeast and Oyo in the southwest. These two states exhibit distinct habitual product color preferences for staple food made with cassava. We estimate the effect of nutrition information campaigns and nature of planting material delivery institutions on consumer demand. Willingness to pay estimations account for the effect of product endowment, censoring in bids and nonpayment. In Oyo, consumers are willing to pay a premium for light yellow cassava variety even in the absence of nutrition information. The article finds that nutrition information results in a large and significant price premium for biofortified cassava in both states, and the nature of delivery institution has no significant effect.     

Cost-effectiveness of alternative green payment policies for conservation technology adoption with heterogeneous land quality

This paper quantitatively analyses the cost‐effectiveness of alternative green payment policies designed to achieve a targeted level of pollution control by heterogeneous microunits. These green payment policies include cost‐share subsidies that share the fixed costs of adoption of a conservation technology and/or input reduction subsidies to reduce the use of a polluting input. The paper shows that unlike a pollution tax that achieves abatement through three mechanisms, a negative extensive margin effect, a negative intensive margin effect and a technology switching effect, a cost‐share subsidy and an input reduction subsidy are much more restricted in the types of incentives they provide for conservation of polluting inputs and adoption of a conservation technology to control pollution. Moreover, they may lead to varying levels of expansion of land under production. Costs of abatement with alternative policies and implications for production and government payments are compared using a simulation model for controlling drainage from irrigated cotton production in California, with drip irrigation as a conservation technology.     

宁波皎口水库复合生态湿地工程

随着经济社会的迅速发展,水源地上游的大量氮磷营养盐不断输入水体,造成城市供水水库富营养化问题日益严重。为削减入库水体污染物,宁波原水集团有限公司在皎口水库建设了入库前置人工生态湿地工程,技术先进,设计科学,管理维护方便。经过两年运行,工程效益显著,值得推广。     

Value elicitation for multiple quantities of a quasi‐public good using open ended choice experiments and uniform price auctions

Choice experiments and experimental auctions have become popular mechanisms for estimating willingness to pay (WTP). However, these methods have primarily been used for estimating WTP for single units of goods. We analyze the results from experimental auctions and choice experiments in the context of multiple quantities of a quasi‐public good (animal welfare product). We show that the use of WTP values for a single unit of a product, a common practice in experimental valuation literature, can result in underestimation of aggregate demand. We use and compare open ended choice experiments (OECE), second price Vickrey auctions, and random Nth price auctions as mechanisms for valuing WTP. Our results also suggest that individual level demand estimates from OECE are less elastic than demand estimates from uniform price auctions.     

Opportunity cost of water allocation to afforestation rather than conservation of natural vegetation in China

Estimation of ecosystem service values is a hot area of research in ecological conservation and economics. However, the costs of these outputs are largely unknown. In this paper, we estimated the opportunity cost of water allocated to afforestation projects through mathematical modeling based on statistical data for all of China to provide support for restoration planning based on a fuller consideration of the true costs. To guide future ecological conservation and environmental policy development, we illustrate a neglected concept (ecosystem service costs) and use this concept to compare the ecological services provided by ecological restoration based on afforestation with those of restoration based on the conservation of natural vegetation using data obtained since 1949 in China. The results showed that afforestation and natural vegetation create annual costs related to use of the available water resources equal to 4800 and 3700 RMB ha⁻¹, respectively, representing a water opportunity cost of 1100 RMB ha⁻¹ for afforestation. This illustrates the rule that “there is no free lunch” for any service, including ecosystem services. Therefore, to support the development of more effective and sustainable environmental restoration policy, it will be necessary to evaluate the associated opportunity costs.     

Payments for agrobiodiversity conservation services: An overview of Latin American experiences,lessons learned and upscaling challenges

Many developing countries face a major challenge today: how to safeguard the biodiversity maintained in the fields of the rural poor - which constitute a national and global public good - whilst meeting those same people's development needs and rights? A solution to this dilemma has thus been sought in adapting the design and implementation of Payments for Ecosystem Services (PES) concepts to the conservation of agrobiodiversity.Here we review the application of nine such Payments for Agrobiodiversity Conservation (PACS) schemes that have been applied to date in four Latin American countries over the period 2010–2018. These covered 130 threatened varieties across a number of major food crops, and involved over 100 farming communities and 1,100 farmers (45 % of which were women). Conservation service offers were received through a competitive tender mechanism. Average bid offers revealed high heterogeneity, varying between US$675/ha. to ten times as much.In relation to issues identified as key to PES, such as spatial targeting, differentiated payments and conditionality, the underlying design of the PACS schemes may be considered solid. PACS-related prioritisation processes allow for the a priori identification of sites with high ecosystem service densities and high threat levels. The use of competitive tenders permits accounting for cost heterogeneity in the provision of conservation services and for payments to be differentiated. Conditionality is strong.In terms of implementation, a “back of the envelope” calculation based on the results of the competitive tenders suggests that conservation costs are modest. For a priority conservation portfolio of 100 varieties (which may be from different crops) each with a target area of five hectares, costs would amount to just under US$860,000 over twenty years or US$70,000 p.a. at a 5 % discount rate. The small-scale and one-off nature of the interventions realised to date, along with threatened crop variety seed availability constraints, have however meant that environmental effectiveness has been incomplete in the short-term (area cultivated with specific threatened varieties increased, but still below the “not at risk” threshold). The establishment of systematic monitoring systems is required to determine longer-term impacts and inform more regular PACS interventions within a dynamically evolving systems context.     

One federal policy,four different policy contexts: An examination of agri-environmental policy implementation in the Midwestern United States

Much research attention has been given to devolved environmental policies and variation in state adoption of environmental policies. Less attention has been paid to variation in top-down federal policies, including in the agri-environmental arena. The Environmental Quality Incentives Program (EQIP) is the largest working land conservation program in the United States, incentivizing the adoption of conservation practices on active agricultural land through cost-share and technical assistance. While the program is federal, state offices of the Natural Resources Conservation Service (NRCS) are charged with implementing the program in their state. Qualitative interviews (n = 26) were conducted with NRCS personnel in four Midwestern states to explore similarities and differences between state administrative outputs. Program outputs are determined through a mixture of national, state, and local administrative processes and are driven by dissimilarities in state resource concerns and agricultural systems. The process by which farmers apply for cost-share funding through EQIP is largely the same across states, but states vary in several important outputs, especially resource and conservation practice priority, as well as state and local partnerships. Outreach methods do not tend to vary between states; NRCS districts typically rely on passive recruitment and word-of-mouth recruitment. Divergence in state EQIP outputs constitute a significant difference in the policy context in which farmers make conservation decisions in the Midwest, which has implications for research concerning farmer behavior. While federal policies implemented across the states offer some level of consistency in the setting in which individual land managers make decisions, variation may still exist in many policies that results in different policy outputs.     

Adoption of soil conservation practices in Belgium: An examination of the theory of planned behaviour in the agri-environmental domain

Soil erosion is a problem with serious on-site and off-site consequences. There exists a broad series of measures to mitigate soil erosion, unfortunately policy makers observe little voluntary adoption. This paper reports on a study to elicit the factors explaining adoption of soil erosion control practices in Belgium. Following a socio-psychological approach, the theory of planned behaviour (TPB), adoption of cover crops, reduced tillage and buffer strips is evaluated using linear regression techniques. Results show that the most explaining factor is attitude towards the soil conservation practice. The TPB adapted to include perceived control and difficulty appears to provide a suitable framework for evaluating adoption of erosion control measures in Belgium. Future interventions directed at promoting erosion control measures should be directed at changing the attitude of farmers. Further study is, however, required in order to elucidate the cognitive foundations of the negative attitude of a majority of farmers towards the implementation of erosion control practices.