Designing Biodiversity Credit Schemes: Combining Implementation Scale and Certification Metrics for Farmers' Participation

Kota Mameno, Masayuki Sato, Yasushi Shoji and Takahiro Kubo
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Takahiro Kubo: National Institute for Environmental Studies (NIES)

No 43yg5_v1, SocArXiv from Center for Open Science

Abstract: Biodiversity credit schemes have gained attention as a mechanism for mobilizing private finance for biodiversity conservation. As primary suppliers of biodiversity outcomes in agricultural landscapes, farmers’ willingness to participate is critical to the success of these schemes. However, little is known about farmers' preferences for biodiversity credit designs, particularly regarding metrics used to certify biodiversity outcomes and the spatial scales at which biodiversity credits are implemented. To our knowledge, this is the first study to provide empirical evidence on how certification metrics and implementation scales influence farmers' preferences for voluntary biodiversity credit schemes. A discrete choice experiment with a latent class model were applied to examine Japanese farmers' preferences for alternative biodiversity credit schemes. The results showed substantial heterogeneity in farmers' willingness to participate in biodiversity credit schemes, with approximately half of the farmers belonging to a participation-averse group. In both groups, implementation scale was the primary determinant of participation decisions. Farmers preferred individual farmland scale implementation over coordinated participation. Certification metric exerted limited influence on participation decisions, suggesting that ecosystem-based credits can be implemented without substantially reducing farmers' willingness to participate. Additional bonuses increased participation among farmers already willing to participate, but had little effect on initially reluctant farmers . Membership analysis indicated that willingness to participate was positively associated with biodiversity policy awareness, biodiversity-friendly farming practices, pro-biodiversity attitudes, and expectations of branding-related benefits. Expanding voluntary biodiversity credit markets, therefore, requires not only financial compensation but also information provision, demonstration projects, and communication of potential market benefits.

Date: 2026-08-25
New Economics Papers: this item is included in nep-dcm and nep-exp
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Persistent link: https://EconPapers.repec.org/RePEc:osf:socarx:43yg5_v1

DOI: 10.31235/osf.io/43yg5_v1

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