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Designing agro-environmental contracts: can collective conditionality improve participation?

Abstract : Drawing an analogy between agro-environmental contracts and subsidy schemes to improve the voluntary contribution to threshold public goods, we design a lab experiment to compare the effectiveness and the efficiency of two types of subsidies: contracts with individual payments proportional to individual environmental efforts (similar to existing agro-environmental schemes); and contracts with the same individual payments but conditioned to the attainment of a collective threshold. Our experimental results show that subsidy schemes are not only effective but also efficient to improve public good production. In addition, introducing a conditionality on collective contributions improves the efficiency of the mechanism. Indeed, conditional subsidies are paid only when the threshold public good is produced and have similar effects on the success of public good production as unconditional subsidies. Finally, individual behavior is analyzed to understand the heterogeneity observed across groups. We focus on the effects of beliefs about others’ contributions and risk aversion. These results suggest that the introduction of a collective conditionality should be considered in the design of agro-environmental schemes for the 2013 CAP reform.
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https://hal.inrae.fr/hal-02744928
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  • HAL Id : hal-02744928, version 1
  • PRODINRA : 221284

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Philippe Le Coent, Raphaële Préget, Sophie Thoyer. Designing agro-environmental contracts: can collective conditionality improve participation?. 7. Journées de Recherches en Sciences Sociales, Société Française d'Economie Rurale (SFER). FRA., Dec 2013, Angers, France. 27 p. ⟨hal-02744928⟩

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