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Evaluating incentive mechanisms for conserving habitat


  • Parkhurst, Gregory M
  • Shogren, Jason F


Private lands have an important role in the success of the Endangered Species Act (ESA). The current command-andcontrol approach to protecting species on private land has resulted in disincentives to the landowner, which have decreased the ability of the ESA to protect many of our endangered and threatened species. Herein we define and evaluate, from an economic perspective, eight incentive mechanisms, including the status quo, for protecting species on private land. We highlight the strengths and weaknesses and compare and contrast the incentive mechanisms according to a distinct set of biological, landowner, and government criteria. Our discussion indicates that market instruments, such as tradable permits or taxes, which have been successful in controlling air pollution, are not as effective for habitat protection. Alternatively, voluntary incentive mechanisms can be designed such that landowners view habitat as an asset and are willing participants in protecting habitat. The incentive mechanism best suited for conserving habitat in a given region depends on many factors, including government funding, land values, quantity and quality of habitat, and the region's developmental pressure.

Suggested Citation

  • Parkhurst, Gregory M & Shogren, Jason F, 2005. "Evaluating incentive mechanisms for conserving habitat," MPRA Paper 34552, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:34552

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    Cited by:

    1. Warziniack, Travis & Shogren, Jason F. & Parkhurst, Gregory, 2007. "Creating contiguous forest habitat: An experimental examination on incentives and communication," Journal of Forest Economics, Elsevier, vol. 13(2-3), pages 191-207, August.
    2. Zhang, Wei & Ricketts, Taylor H. & Kremen, Claire & Carney, Karen & Swinton, Scott M., 2007. "Ecosystem services and dis-services to agriculture," Ecological Economics, Elsevier, vol. 64(2), pages 253-260, December.
    3. Matta, Jagannadha R. & Alavalapati, Janaki R.R. & Stainback, George A., 2009. "Effect of conserving habitat for biodiversity on optimal management of non-industrial private forests in Florida," Journal of Forest Economics, Elsevier, vol. 15(4), pages 223-235, December.
    4. Buller, Virginia & Hudson, Darren, 2006. "The Impacts of Alternative Institutions on Distributional and Environmental Efficiency in Environmental Programs," 2006 Annual Meeting, February 5-8, 2006, Orlando, Florida 35423, Southern Agricultural Economics Association.

    More about this item


    Incentives; Conservation; TDRs; Subsidies; Zoning; conservation Easements; mitigation banking; impact fees;

    JEL classification:

    • Q24 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Land
    • D01 - Microeconomics - - General - - - Microeconomic Behavior: Underlying Principles
    • Q30 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - General


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