Using choice experiments to improve the design of agri-environmental schemes. (13th June 2019)

• Record Type: Journal Article
• Authors: Latacz-Lohmann, Uwe; Breustedt, Gunnar
• Is Part Of: European review of agricultural economics. Volume 46:Number 3(2019)
• Page Start: 495
• Page End: 528
• Publication Date: 2019-06-13
• Subjects: agri-environmental schemes -- nature conservation -- discrete choice modelling -- multinomial Heckman estimation -- simulation -- willingness-to-accept; Agriculture -- Economic aspects -- Periodicals; Agriculture -- Economic aspects -- Europe -- Periodicals; 338.109405
• DOI: 10.1093/erae/jbz020
• Languages: English
• ISSNs: 0165-1587

Abstract

Abstract: This study applies a two-stage analysis of discrete–continuous supply of environmental services, based on an extended discrete choice experiment (DCE) with 68 farmers in Northern Germany. The estimation strategy combined a multinomial Heckman model and an OLS regression. We extend the literature by feeding the estimation results into a contract optimisation model for a stylised conservation scheme. The optimised contract differed significantly from the standard contract, which offered farmers a payment equal to the average cost of service provision. The standard contract yielded only 64 per cent of the environmental service of the optimised contract for the same budget outlay.