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Payments for environmental services with provision thresholds: farmers’ preferences for a conditional bonus

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  • Le Gloux, Fanny
  • Dupraz, Pierre
  • Issanchou, Alice
  • Ropars-Collet, Carole

Abstract

The effectiveness of payment schemes for delivering agri-environmental public goods with provision thresholds (biodiversity, water quality) depends on reaching enough farmland enrolment at the landscape scale. Supporting the development of collaborative approaches with a financial bonus conditioned to a collective element on top of an individual basic payment is a promising way to favour participation and continuity of environmental commitments in an area. However, little is known on farmers’ attitudes towards such mixed-payment mechanisms. Using a choice experiment, we measure farmers’ preferences towards an individual bonus for sponsoring peers, which can be combined with a collective bonus for improving the ecological quality of rivers in northwestern France. Applying a mixed logit model, we find that respondents have a positive willingness to accept contracts with a sponsor bonus, but a negative willingness to accept a sponsor bonus combined with a bonus for reaching a collective environmental objective. We characterize respondents’ heterogeneity with a latent class model and identify 3 different attitudes towards the bonus options: (i) negative preferences for both, particularly for the combined bonus, (ii) indifference, (iii) positive preferences for both, even higher for the combined bonus.

Suggested Citation

  • Le Gloux, Fanny & Dupraz, Pierre & Issanchou, Alice & Ropars-Collet, Carole, 2022. "Payments for environmental services with provision thresholds: farmers’ preferences for a conditional bonus," 96th Annual Conference, April 4-6, 2022, K U Leuven, Belgium 321177, Agricultural Economics Society - AES.
    • Handle: RePEc:ags:aesc22:321177
    DOI: 10.22004/ag.econ.321177
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    References listed on IDEAS

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    Keywords

    Agricultural and Food Policy; Agricultural Finance; Environmental Economics and Policy;
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