The present paper proposes that markets for nature conservation on private land are missing because of the problem of asymmetric information. An auction of conservation contracts was designed to reveal hidden information needed to facilitate meaningful transactions between landholders and government. The present paper describes the key elements of auction and contract design employed and the results obtained from a pilot auction of conservation contracts run in two regions of Victoria. The pilot demonstrated that it was possible to create at least the supply side of a market for nature conservation and in conjunction with a defined budget, prices were discovered and resources allocated through contracts with landholders. The present paper compares a discriminative price auction with a hypothetical fixed-price scheme showing that an auction could offer large cost savings to governments interested in nature conservation on private land. The paper identifies some important design problems that would need to be solved before auctions could be applied more broadly including: multiple complementary outcomes, reserve prices, sequential auction design and contract design. Nevertheless, the paper does show that auctioning conservation contracts for environmental outcomes is an important new policy mechanism that deserves closer examination.

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Public private partnerships (PPPs) have evolved as a strategic response to public sector resource deficits and for pooling technical, managerial, and financial resources from the private sector. In this article, we identify the key factors necessary for a collaborative management strategy and analyze the structural and operational issues of two infrastructure projects in Australia. This article explains how a PPP offers a different set of strategic options to deal with complex micromanagement issues and argues that the success of PPPs depends on the processes and actions used to cocreate managerial social capital, building mutual trust by sharing risks, responsibilities, and experience.