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Compliance Monitoring and Agri-Environmental Policy

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  • Chongwoo Choe

    (School of Economics, La Trobe University)

  • Iain Fraser

    (School of Economics, La Trobe University)

Abstract

This paper uses an optimal contract approach to examine the issue of compliance monitoring in agri-environmental policy when the farmer is risk neutral and risk averse. The environmental agency chooses monitoring accuracy and payments for farmer's (non-)compliance. With a risk-neutral farmer, an optimal policy involves maximum allowable reward for compliance and maximum allowable penalty for non-compliance.

Suggested Citation

  • Chongwoo Choe & Iain Fraser, 1997. "Compliance Monitoring and Agri-Environmental Policy," Working Papers 1997.08, School of Economics, La Trobe University.
  • Handle: RePEc:trb:wpaper:1997.08
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    Keywords

    Information; Environmental Management;

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