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How behavioural and experimental economics can contribute to agricultural policy with an application to agri-emissions pricing

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  • Zack Dorner

Abstract

In this paper, I discuss the role that behavioural and experimental economics can play in improving agricultural policymaking. I do so by considering the development of an agri-emissions pricing policy in NZ. International literature shows that profit, as well as a range of other factors such as social norms and identity, drive farmer behaviour. This is particularly true for adoption of sustainable technologies and practices. A better understanding of farmer behaviour provides potential for: (1) an increased understanding of the uncertainty around policy modelling; (2) an increase in the accuracy of policy modelling, particularly when emission prices are low; (3) potential for new policy tools. Experimental economics provides a powerful methodology to build behavioural understanding and test policy tools. I argue that a behavioural economics perspective can contribute to agricultural policy, but add a note of caution that the gains to modelling accuracy and improved policy design are not guaranteed.

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  • Zack Dorner, 2023. "How behavioural and experimental economics can contribute to agricultural policy with an application to agri-emissions pricing," New Zealand Economic Papers, Taylor & Francis Journals, vol. 57(2), pages 191-197, May.
    • Handle: RePEc:taf:nzecpp:v:57:y:2023:i:2:p:191-197
    DOI: 10.1080/00779954.2022.2154252
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