Hostname: page-component-586b7cd67f-t7czq Total loading time: 0 Render date: 2024-11-26T15:05:01.276Z Has data issue: false hasContentIssue false
  • English
  • Français

Implementing and evaluating the effectiveness of a payment scheme for environmental services from agricultural land

Published online by Cambridge University Press:  03 August 2011

LENA ULBER ,
SEBASTIAN KLIMEK ,
HORST-HENNING STEINMANN ,
JOHANNES ISSELSTEIN  and
MARKUS GROTH
LENA ULBER*
Affiliation:
Research Centre for Agriculture and the Environment, Georg-August-University of Goettingen, Grisebachstrasse 6, 37077 Goettingen, Germany
SEBASTIAN KLIMEK
Affiliation:
Institute of Biodiversity, Johann Heinrich von Thuenen-Institute (vTI), Federal Research Institute for Rural Areas, Forestry and Fisheries, Bundesallee 50, 38116 Braunschweig, Germany
HORST-HENNING STEINMANN
Affiliation:
Research Centre for Agriculture and the Environment, Georg-August-University of Goettingen, Grisebachstrasse 6, 37077 Goettingen, Germany
JOHANNES ISSELSTEIN
Affiliation:
Department of Crop Sciences, Institute of Grassland Science, Georg-August-University of Goettingen, Von-Siebold Strasse 8, 37075 Goettingen, Germany
MARKUS GROTH
Affiliation:
Economics and Policy Department, Climate Service Center (CSC), Bundesstrasse 45a, 20146 Hamburg, Germany
*
*Correspondence: Lena Ulber, Institute for Plant Protection in Field Crops and Grassland, Julius Kühn-Institut (JKI), Federal Research Centre for Cultivated Plants, Messeweg 11-12, 38104 Braunschweig, Germany Tel: +49 531 299 3903 e-mail: [email protected]
Get access Rights & Permissions [Opens in a new window]

Summary

The current rapid decline in biodiversity in human-dominated agricultural landscapes, both in Europe and worldwide, impacts on the provision of environmental services essential to human well-being. There is, therefore, a pressing need to develop and implement incentive-based conservation policies to counteract the ongoing loss of biodiversity. This paper presents results of a regionally-scaled conservation procurement auction, a type of incentive-based payments for environmental services (PES), targeted at the conservation of arable plant diversity. By matching arable fields that were participating in the PES scheme to control fields that were not enrolled in the PES scheme, two critical key characteristics were addressed, namely additionality and bid prices. Additionality was addressed by evaluating whether fields for which PES were issued had significantly higher arable plant diversity than the matched control fields. The cost-effectiveness of a conservation auction increases if payments compensate just farmers’ opportunity costs (in terms of forgone production); bid prices of participating farmers were thus also evaluated to determine whether they were related to their individual opportunity costs. The PES scheme proved to be highly effective in ensuring environmental services delivery through enhanced arable plant diversity on participating fields. In contrast, the potential of the proposed conservation auction design to raise cost-effectiveness has to be questioned, because bid prices submitted in this scheme substantially exceeded individual farmers’ opportunity costs. Therefore, bid prices were most likely influenced by socioeconomic factors other than opportunity costs. This case study illustrates potentials and pitfalls associated with the implementation of a PES scheme and, by evaluating the effectiveness of the scheme, contributes to an improved understanding of incentive-based mechanisms for both policymakers and practitioners involved in PES scheme design and implementation.

Keywords

arable plant speciesbiodiversityconservation procurement auctionscost-effectivenessopportunity costs
Type
THEMATIC SECTION: Payments for Ecosystem Services in Conservation: Performance and Prospects
Information
Environmental Conservation , Volume 38 , Issue 4: Thematic section. Payments for Ecosystem Services in Conservation: Performance and Prospects , December 2011 , pp. 464 - 472
Copyright
Copyright © Foundation for Environmental Conservation 2011

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Aavik, T. & Liiraa, J. (2009) Agrotolerant and high nature-value species. Plant biodiversity indicator groups in agroecosystems. Ecological Indicators 9: 892–901.CrossRefGoogle Scholar
Bräuer, I., Müssner, R., Marsden, K., Oosterhuis, F., Rayment, M., Miller, C. & Dodoková, A. (2006) The Use of Market Incentives to Preserve Biodiversity. Final report of a project under the Framework contract for economic analysis ENV.G.1/FRA/2004/0081 [www document]. URL http://ec.europa.eu/environment/enveco/biodiversity/pdf/mbi.pdfGoogle Scholar
Carreck, N.L. & Williams, I.H. (2002) Food for insect pollinators on farmland: insect visits to flowers of annual seed mixtures. Journal of Insect Conservation 6: 13–23.CrossRefGoogle Scholar
Cason, T. & Gangadharan, L. (2005) A laboratory comparison of uniform and discriminative price auctions for reducing non-point source pollution. Land Economics 81: 55–70.CrossRefGoogle Scholar
Connor, J.D., Ward, J.R. & Bryan, B. (2008) Exploring the cost effectiveness of land conservation auctions and payment policies. The Australian Journal of Agricultural and Resource Economics 51: 303–319.CrossRefGoogle Scholar
Cummings, R. G, Holt, C. A. & Laury, S. K. (2004) Using laboratory experiments for policymaking: an example from the Georgia Irrigation Reduction Auction. Journal of Policy Analysis and Management 23: 341–363.CrossRefGoogle Scholar
Ferraro, P. J. (2008) Asymmetric information and contract design for payments for environmental services. Ecological Economics 65: 810–821.CrossRefGoogle Scholar
Ferraro, P. J. & Pattanayak, S. K. (2006) Money for nothing? A call for empirical evaluation of biodiversity conservation investments. PLoS Biology 4: e105.CrossRefGoogle Scholar
Garve, E. (2004) Rote Liste und Florenliste der Farn- und Blütenpflanzen in Niedersachsen und Bremen. Informationsdienst Naturschutz Niedersachsen 1: 1–76.Google Scholar
Gerowitt, B., Bertke, E., Hespelt, S. K. & Tute, C. (2003) Towards multifunctional agriculture: weeds as ecological goods? Weed Research 43: 227–235.CrossRefGoogle Scholar
Hailu, A. & Thoyer, S. (2006) Multi-unit auction format design. Journal of Economic Interaction and Coordination 1: 129–146.CrossRefGoogle Scholar
Hawes, C., Haughton, A.J., Osborne, J.L., Roy, D.B., Clark, S.J., Perry, J.N., Rothery, P., Bohan, D.A., Brooks, D.R., Champion, G.T., Dewar, A.M., Heard, M.S., Woiwod, I.P., Daniels, R.E., Young, M.W., Parish, A.M., Scott, R.J., Firbank, L.G. & Squire, G.R. (2003) Responses of plant and invertebrate trophic groups to contrasting herbicide regimes in the farm scale evaluations of genetically-modified herbicide-tolerant crops. Philosophical Transactions of the Royal Society of London B 358: 1899–1913.Google ScholarPubMed
Heard, M.S., Hawes, C., Champion, G.T., Clark, S.J., Firbank, L.G., Haughton, A.J., Parish, A.M., Perry, J.N., Rothery, P., Scott, R.J., Skellern, M.P., Squire, G.R. & Hill, M.O. (2003) Weeds in fields with contrasting conventional and genetically modified herbicide-tolerant crops. II. Effect on individual species. Philosophical Transactions of the Royal Society London B 358: 1833–1846.Google ScholarPubMed
Jack, B.K., Kouskya, C. & Sims, K.R.E. (2008) Designing payments for ecosystem services: lessons from previous experience with incentive-based mechanisms. Proceedings of the National Academy of Sciences USA 105: 9465–9470.CrossRefGoogle ScholarPubMed
Jack, B.K., Leimona, B. & Ferraro, P.J. (2009) A revealed preference approach to estimating supply curves for ecosystem services: use of auctions to set payments for soil erosion control in Indonesia. Conservation Biology 23: 359–367.CrossRefGoogle ScholarPubMed
Kirwan, B., Lubowski, R.N. & Roberts, M.J. (2005) How cost-effective are land-retirement auctions? Estimating the difference between payments and willingness to accept in the Conservation Reserve Program. American Journal of Agricultural Economics 87: 1239–1247.CrossRefGoogle Scholar
Klimek, S., Richter gen. Kemmermann, A., Steinmann, H.-H., Freese, J. & Isselstein, J. (2008) Rewarding farmers for delivering vascular plant diversity in managed grasslands: a transdisciplinary case-study approach. Biological Conservation 141: 2888–2897.CrossRefGoogle Scholar
Kroeger, T. & Casey, F. (2007) An assessment of market-based approaches to providing ecosystem services on agricultural lands. Ecological Economics 64: 321–332.CrossRefGoogle Scholar
KTBL (2009) Faustzahlen für die Landwirtschaft, Darmstadt, Germany. 13th Edition.Google Scholar
Latacz-Lohmann, U. & Schilizzi, S. (2007) Quantifying the benefits of conservation auctions. EuroChoices 6: 32–39.Google Scholar
Latacz-Lohmann, U. & Van der Hamsvoort, C. (1997) Auctioning conservation contracts: a theoretical analysis and an application. American Journal of Agricultural Economics 79: 407–418.CrossRefGoogle Scholar
McKee, M. & Berrens, R. P. (2001) Balancing army and endangered species concerns: green vs. green. Environmental Management 27: 123–133.CrossRefGoogle Scholar
Mettepenningen, E., Verspecht, A. & van Huylenbroeck, G. (2009) Measuring private transaction costs of European agri-environmental schemes. Journal of Environmental Planning and Management 52: 649–667.CrossRefGoogle Scholar
Naidoo, R., Balmford, A., Ferraro, P.J., Polasky, S., Ricketts, T.H. & Rouget, M. (2006) Integrating economic costs into conservation planning. Trends in Ecology and Evolution 21: 681–687.CrossRefGoogle ScholarPubMed
Rolfe, J., Windle, J. & McCosker, J. (2009) Testing and implementing the use of multiple bidding rounds in conservation auctions: a case study application. Canadian Journal of Agricultural Economics 57: 287–303.CrossRefGoogle Scholar
Rollett, A., Haines-Young, R., Potschin, M. & Kumar, P. (2008) Delivering environmental services through agri-environment programmes: a scoping study. Land Use Policy Group, The UK statutory conservation, countryside and environment agencies [www document]. Report. URL http://www.lupg.org.uk/pdf/Delivering_Env_Services_through_agri-env_programmes-scoping_study.pdfGoogle Scholar
Schilizzi, S. & Latacz-Lohmann, U. (2007) Assessing the performance of conservation auctions: an experimental study. Land Economics 83: 497–515.CrossRefGoogle Scholar
Sinden, J. A. (2004) Estimating the costs of biodiversity protection in the Brigalow belt, New South Wales. Journal of Environmental Management 70: 351–362.CrossRefGoogle ScholarPubMed
Stoneham, G., Chaudhri, V., Ha, A. & Strappazzon, L. (2003) Auctions for conservation contracts: an empirical examination of Victoria's BushTender trial. The Australian Journal of Agricultural and Resource Economics 47: 477–500.CrossRefGoogle Scholar
ten Brink, P., Berghöfer, A., Schröter-Schlaack, C., Sukhdev, P., Vakrou, A., White, S. & Wittmer, H. (2009) TEEB: The Economics of Ecosystems and Biodiversity for National and International Policy Makers. Summary: Responding to the Value of Nature [www document]. Report. URL http://www.teebweb.org/LinkClick.aspx?fileticket=I4Y2nqqIiCg%3DGoogle Scholar
Ulber, L., Steinmann, H.-H., Klimek, S. & Isselstein, J. (2009) An on-farm approach to investigate the impact of diversified crop rotations on weed species richness and composition in winter wheat. Weed Research 49: 534–543.CrossRefGoogle Scholar
Wätzold, F. & Schwerdtner, K. (2005) Why be wasteful when preserving a valuable resource? A review article on the cost-effectiveness of European biodiversity conservation policy. Biological Conservation 123: 327–338.CrossRefGoogle Scholar
Windle, J. & Rolfe, J. (2008) Exploring the efficiencies of using competitive tenders over fixed price grants to protect biodiversity in Australian rangelands. Land Use Policy 25: 388–398.CrossRefGoogle Scholar
Wunder, S. (2007) The efficiency of payments for environmental services in tropical conservation. Conservation Biology 21: 48–58.CrossRefGoogle ScholarPubMed
Wunder, S., Engel, S. & Pagiola, S. (2008) Taking stock: a comparative analysis of payments for environmental services programs in developed and developing countries. Ecological Economics 65: 834–852.CrossRefGoogle Scholar
Zabel, A. & Roe, B. (2009) Optimal design of pro-conservation incentives. Ecological Economics 69: 126–134.CrossRefGoogle Scholar