Do monetary rewards for spatial coordination enhance participation in a forest incentive program?

Among voluntary incentive programs in which private landowners receive a monetary transfer in exchange for conservation efforts, schemes providing payments conditional on spatial coordination are expected to enhance the effectiveness of conservation programs. Supportive evidence for such schemes is primarily derived from experimental or simulation-based research, but it is unclear whether real-world landowners might exhibit similar responses to such economic incentives. With detailed spatial data on forest parcels and actual contract information, this paper examines parcel-level responses to monetary returns from spatial coordination in a forest incentive program. Because the interdependence of payoffs among neighboring forest parcels predicts the establishment of multiple equilibria, I apply a simulation-based estimator in which it is assumed that each equilibrium will be realized with an equal probability. I found that monetary rewards positively influence parcel enrollment. However, the results also suggest that an additional monetary transfer causes almost no difference in parcel enrollment or the spatial connectedness of enrolled parcels.