Using choice experiments to improve the design of agri-environmental schemes

Uwe Latacz-Lohmann and Gunnar Breustedt

European Review of Agricultural Economics, 2019, vol. 46, issue 3, 495-528

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.

Keywords: agri-environmental schemes; nature conservation; discrete choice modelling; multinomial Heckman estimation; simulation; willingness-to-accept (search for similar items in EconPapers)
Date: 2019
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Citations: View citations in EconPapers (25)

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