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Group decision-making theory and behavior under performance-based water quality payments

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  • Collins, Alan R.
  • Maille, Peter

Abstract

Two theoretical models explaining group allocation decisions under watershed level, performance-based payments are explored: (I) reward and penalize individual contributors; and (II) reduce the problem with cost-sharing and cooperative abatement. Under Model I, an optimal amount of pollution from individual contributors can be achieved with proper payment incentive and group allocation formula. Model II represents a cost effective solution to pollution reduction where the group optimizes its return from group payments, but does not necessarily achieve an optimal level of pollution. Field experiment observations support farmer behavior closer to Model II.

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  • Collins, Alan R. & Maille, Peter, 2011. "Group decision-making theory and behavior under performance-based water quality payments," Ecological Economics, Elsevier, vol. 70(4), pages 806-812, February.
    • Handle: RePEc:eee:ecolec:v:70:y:2011:i:4:p:806-812
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    Cited by:

    1. Fabien Martinez, 2015. "A Three-Dimensional Conceptual Framework of Corporate Water Responsibility," Post-Print hal-02887624, HAL.
    2. Matthew Kotchen & Kathleen Segerson, 2020. "The Use of Group-Level Approaches to Environmental and Natural Resource Policy," NBER Working Papers 27142, National Bureau of Economic Research, Inc.

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