The political economy of certificates for land use in Germany – experimental evidence

Abstract

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Tradable development rights under uncertainty: an experimental approach

“…This result has been shown in previous experimental studies on TDR (Meub et al, 2014(Meub et al, , 2015(Meub et al, , 2016 and can be interpreted as resulting from the endowment effect (Kahneman et al, 1991 …”

“…For instance, Henger (2013) compares the performance of student participants and municipal planners, finding that both groups achieve a fairly efficient allocation of certificates. Moreover, Meub et al (2014) consider the influence of political business cycles within a TDR system, while Meub et al (2015) investigate the efficiency of different mechanisms for allocating development rights and Meub et al (2016) show the impact of macroeconomic shocks on a system of TDR.…”

The Role of Communication on an Experimental Market for Tradable Development Rights

“…As previous studies have emphasized (Meub et al, 2014(Meub et al, , 2016Proeger et al, 2015), average market prices tend to exceed unit auction prices, which might be explained by the endowment effect (Kahneman et al, 1991).…”

“…Testing the general applicability of results obtained by observing student participants to land use decisions, Henger (2013) compared the performance of students and regional planners in a TDR scheme, yielding the result that both groups achieve efficient reallocations of development rights overall. Meub et al (2014) extend this basic setting and investigate the influence of political business cycles on the efficiency of TDR schemes, pointing to potential distortions in TDR schemes due to politicians' self-serving incentives. Meub et al (2015) compare different mechanisms of issuing development rights, finding that auctioning introduces several sources of inefficiency, making grandfathering the superior institutional choice from a welfare perspective.…”

Laboratory Experiments of Tradable Development Rights: A Synthesis of Different Treatments

“…This paper aims to summarize, interrelate, and discuss the findings of a series of experimental studies conducted in recent years by the authors [14][15][16][17][18]. While there are several experiments testing CO 2 trading schemes (e.g., [19,20]), on which our experimental design builds, there have been only few (field) experimental approaches dealing with TDR (e.g., [21]).…”