Competition-Based Environmental Policy: An Analysis of Farmland Preservation in Maryland
John K. Horowitz,
Lori Lynch () and
Land Economics, 2009, vol. 85, issue 4, 555-575
Policy makers have turned to competition- based voluntary-enrollment programs as a cost-effective way to achieve preferred land uses. This paper studies bidder behavior in an innovative auction-based program in which farmers compete to sell and retire the right to develop their land. We derive a reduced-form bidding model that includes private and common values. This model allows us to estimate the role of bidder competition, winner’s curse correction, and the underlying distribution of private values. We estimate that the auction enrolled as many as 3,000 acres (12%) more than a take-it or- leave-it offer would have enrolled for the same budgetary cost
JEL-codes: Q24 Q28 (search for similar items in EconPapers)
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Working Paper: Competition-Based Environmental Policy: An Analysis of Farmland Preservation in Maryland (2007)
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Persistent link: https://EconPapers.repec.org/RePEc:uwp:landec:v:85:y:2009:i:4:p:555-575
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