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Compensation payments for habitat heterogeneity: Existence, efficiency, and fairness considerations

  • Ohl, C.
  • Drechsler, M.
  • Johst, K.
  • Wätzold, F.
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    Compensation payments for voluntary conservation measures have become an important tool for biodiversity conservation worldwide. Each year substantial financial resources are spent on such measures, particularly in the context of agri-environmental schemes. In Europe, a debate has started on whether this money is spent effectively. In response to this debate it has been suggested that a portfolio of measures leading to habitat heterogeneity be implemented. Although payments for heterogeneous conservation measures have been analysed in the literature, it has never been questioned that payments can be designed in a way that encourages enough land users to carry out each conservation measure within a portfolio of measures. The purpose of this paper is to demonstrate that such payments do not always exist. Moreover, in cases where payments for habitat heterogeneity exist the payment scheme may require overcompensation of the land users, posing a limit to both efficiency and fairness considerations.

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    File URL: http://www.sciencedirect.com/science/article/B6VDY-4SRG16H-1/2/10e18d70ee4976f6732ea5704c636496
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    Article provided by Elsevier in its journal Ecological Economics.

    Volume (Year): 67 (2008)
    Issue (Month): 2 (September)
    Pages: 162-174

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    Handle: RePEc:eee:ecolec:v:67:y:2008:i:2:p:162-174
    Contact details of provider: Web page: http://www.elsevier.com/locate/ecolecon

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    1. Ernst Fehr & Klaus M. Schmidt, . "A Theory of Fairness, Competition and Cooperation," IEW - Working Papers 004, Institute for Empirical Research in Economics - University of Zurich.
    2. Bergmann, Holger, 2004. "Berechnung von Kosten für Maßnahmen zum Schutz von gefährdeten Maculinea-Arten," UFZ Discussion Papers 2/2004, Helmholtz Centre for Environmental Research (UFZ), Division of Social Sciences (ÖKUS).
    3. Wossink, G. A. A. & Oude Lansink, A. G. J. M. & Struik, P. C., 2001. "Non-separability and heterogeneity in integrated agronomic-economic analysis of nonpoint-source pollution," Ecological Economics, Elsevier, vol. 38(3), pages 345-357, September.
    4. Uwe Latacz-Lohmann & Carel Van der Hamsvoort, 1997. "Auctioning Conservation Contracts: A Theoretical Analysis and an Application," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 79(2), pages 407-418.
    5. Frank Wätzold & Martin Drechsler, 2005. "Spatially Uniform versus Spatially Heterogeneous Compensation Payments for Biodiversity-Enhancing Land-Use Measures," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 31(1), pages 73-93, 05.
    6. Axel Ockenfels & Gary E. Bolton, 2000. "ERC: A Theory of Equity, Reciprocity, and Competition," American Economic Review, American Economic Association, vol. 90(1), pages 166-193, March.
    7. Johst, Karin & Drechsler, Martin & Watzold, Frank, 2002. "An ecological-economic modelling procedure to design compensation payments for the efficient spatio-temporal allocation of species protection measures," Ecological Economics, Elsevier, vol. 41(1), pages 37-49, April.
    8. Robert Innes, 2000. "The Economics of Takings and Compensation When Land and Its Public Use Value Are in Private Hands," Land Economics, University of Wisconsin Press, vol. 76(2), pages 195-212.
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