Abstract
Spatial coordination of land use change is pivotal in agri-environmental policy to improve the delivery of environmental goods. This paper implements a laboratory experiment to study spatial coordination in a conservation auction. In addition to letting individual producers bid competitively against each other to supply environmental goods, we ask whether opportunities for joint bidding can enhance spatial coordination in the auction cost-effectively. Auction performance depends on the nature of incentives for individual bids; in particular, whether an agglomeration bonus is of-fered for individual bids. With an individual bonus in place, joint bidding gives no im-provement in either environmental benefits procured or cost-effectiveness. Absent an individual bonus, joint bidding improves environmental performance but can decrease cost-effectiveness. Further, across both individual and joint bidding treatments, the average environmental benefits, degree of spatial coordination, and cost-effectiveness are greater, and amount of seller markups lower, with multiple-round bidding com-pared to single-round bidding.
Original language | English (US) |
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Pages (from-to) | 1013-1049 |
Number of pages | 37 |
Journal | Journal of the Association of Environmental and Resource Economists |
Volume | 8 |
Issue number | 5 |
DOIs | |
State | Published - Sep 2021 |
Keywords
- agri-environmental schemes
- communication
- ecosystem services
- experiment
- networks
ASJC Scopus subject areas
- Economics and Econometrics
- Nature and Landscape Conservation
- Management, Monitoring, Policy and Law