Improving the cost-effectiveness of the Conservation Reserve Program: A laboratory study

Cramton, Peter; Hellerstein, Daniel; Higgins, Nathaniel; Iovanna, Richard; Lopez-Vargas, Kristian; Wallander, Steven

doi:10.1016/j.jeem.2021.102439

Cited by 14 publications

(3 citation statements)

References 23 publications

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“…Furthermore, the CRP has various other constraints, including maximum acreage amounts per county and restrictions on the geographic dispersion of acreage. When combined, these acreage restrictions largely determine program goals for the amount of enrollments that will be accepted in a given General Signup (see, for discussion: Cramton et al, 2021). In setting a targeted amount of acreage to accept, program managers also consider current enrollment levels, forthcoming expirations, as well as future enrollment across General Signup, Continuous Signup, and Grasslands Signup.…”

Section: Background On the Crpmentioning

confidence: 99%

Land use impacts of the Conservation Reserve Program: An analysis of rejected offers

Rosenberg

Pratt

2023

American J Agri Economics

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The Conservation Reserve Program is the largest agricultural land retirement program in the United States, with more enrolled acreage entering the program through a competitive auction called the General Signup than any other component. In this study, we assess the land use impacts of the Conservation Reserve Program by observing the land use decisions of parcels following the 2016 General Signup. We estimate land use impacts using a regression discontinuity design based on the Environmental Benefits Index, the program's selection and ranking mechanism. Our estimates largely rely on the auction design of the General Signup, such that we observe the land use decisions of rejected offers. We also use information on the rental rates of these offers to understand what the program pays to retire land in different uses. We estimate that a marginal acre of land enrolled in the Conservation Reserve Program replaces 0.30 acres in cropland, 0.25 acres in mixed forage, 0.32 acres in grassland, 0.12 acres in idle or fallow land, and 0.01 acres in timberland. We also find that enrollments from newly offered fields are more likely to displace cropland and less likely to displace grassland than returning fields. Consequently, we estimate that new enrollments lead to 47% greater reductions in water‐driven erosion and 12% greater reductions in wind‐driven erosion, compared to fields with prior enrollment.

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Section: Background On the Crpmentioning

confidence: 99%

Land use impacts of the Conservation Reserve Program: An analysis of rejected offers

Rosenberg

Pratt

2023

American J Agri Economics

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“…Reverse auctions were designed with challenges like these in mind. Farmers name their own opportunity costs while facing competitive disincentives against inflating their cost claims; budgetary allocations can account for opportunity cost heterogeneity; farmers do not have to exhaustively document expenditures and are free to price a risk premium into their bids; and selection processes generally follows clear, understandable rules, improving perceptions of transparency even if some need for professional judgment remains (Hellerstein, 2017;Cramton et al, 2021).…”

Section: Auctions In Context: Direct Incentives For Esmentioning

confidence: 99%

Auctioning approaches for ecosystem services – Evidence and applications

Kindu

Mai

Bingham

et al. 2022

Science of The Total Environment

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“…In this paper, we leverage the presence of close community social network ties between people in a real farming community to study a novel spatial auction that encourages joint bid submissions by neighboring auction participants. Individuals in rural farming communities routinely 1 These studies constitute a more focused strand of literature specifically concerning spatial coordination in conservation auctions, which speaks to but also differs from a wider literature on conservation auctions that do not explicitly account for spatial coordination (e.g., Balmford et al, 2023;Cramton et al, 2021;Ferraro et al, 2022), or AB in nonauction contexts (e.g., Parkhurst & Shogren, 2007, 2008Ward et al, 2021).…”

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confidence: 99%

Spatially coordinated conservation auctions: A framed field experiment focusing on farmland wildlife conservation in China

Liu,

Banerjee,

Cason

et al. 2024

American J Agri Economics

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How best to incentivize land managers to achieve conservation goals in an economically and ecologically effective manner is a key policy question that has gained increased relevance from the setting of ambitious new global targets for biodiversity conservation. Conservation (reverse) auctions are a policy tool for improving the environmental performance of agriculture, which has become well‐established in the academic literature and in policy making in the US and Australia. However, little is known about the likely response of farmers to incentives within such an auction to (1) increase spatial connectivity and (2) encourage collective participation. This paper presents the first framed field experiment with farmers as participants that examines the effects of two features of conservation policy design: joint (collective) participation by farmers and the incentivization of spatial connectivity. The experiment employs farmers in China, a country making increasing use of payments for ecosystem services to achieve a range of environmental objectives. We investigate whether auction performance—both economic and ecological—can be improved by the introduction of agglomeration bonus and joint bidding bonus mechanisms. Our empirical results suggest that, compared to a baseline spatially coordinated conservation auction, the performance of an auction with an agglomeration bonus, a joint bidding bonus, or both, is inferior on two key metrics—the environmental benefits generated and cost effectiveness realized.

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Improving the cost-effectiveness of the Conservation Reserve Program: A laboratory study

Cited by 14 publications

References 23 publications

Land use impacts of the Conservation Reserve Program: An analysis of rejected offers

Land use impacts of the Conservation Reserve Program: An analysis of rejected offers

Auctioning approaches for ecosystem services – Evidence and applications

Spatially coordinated conservation auctions: A framed field experiment focusing on farmland wildlife conservation in China

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