Lottery Incentives and Resource Management: Evidence from the Agricultural Data Reporting Incentive Program (AgDRIP)

To manage resources effectively in an agri-environmental context, policymakers need information about on-farm management practices and ecological conditions. This information is often accessible to agricultural producers but not to policymakers. However, little is known about how best to structure incentives for voluntary reporting. In other contexts, lotteries are often used to provide an incentive for voluntary data reporting. This article provides evidence about the efficacy of lottery (stochastic) incentives relative to fixed (deterministic) incentives. Based on two field experiments embedded in a data reporting program for agricultural producers, we estimate that lottery incentives reduced program enrollment between 28% and 62% relative to fixed incentives. A novel feature of our study is a comparison between fixed incentives and actuarially equivalent lotteries with explicitly communicated probabilities, which allows us to rule out an effect size of actuarially equivalent lotteries larger than +15% relative to fixed incentives.