Effects of Exclusion from a Conservation Policy: Negative Behavioral Spillovers from Targeted Incentives

Duke Environmental and Energy Economics Working Paper EE 13-06

29 Pages Posted: 19 Jul 2014

See all articles by Francisco Alpizar

Francisco Alpizar

Tropical Agricultural and Higher Education Center

Anna Norden

University of Gothenburg - Department of Economics and Statistics

Alexander Pfaff

Duke University - Policy, Economics, Environment; Duke University - Department of Psychology and Neuroscience

Juan Robalino

Universidad de Costa Rica - School of Economics

Date Written: October 2013

Abstract

A critical issue in the design of incentive mechanisms is the choice of whom to target. For forests, the leading rules are (1) target locations with high ecosystem-service density; (2) target additionality, i.e., locations where conservation would not occur without the incentive; and, (3) at least effectively reward previous private choices to conserve forest. We use a field experiment to examine the changes in contributions to forest conservation when we introduce each of these selection rules. For individuals who are selected, we find that targeting additionality (rule 2) is the only scheme to increase contributions. However, that selection rule intentionally excludes those who contributed most previously, and it is the only one to generate significant “behavioral leakage,” i.e., negative spillovers or a decrease in contributions by those who are excluded (and who face no price or income changes). Our results demonstrate a tradeoff in targeting and a challenge for optimal policy design.

Keywords: incentives, payment for ecosystem services (PES), targeting, spillovers, behavioral economics, field experiment

Suggested Citation

Alpizar, Francisco and Norden, Anna and Pfaff, Alexander and Robalino, Juan, Effects of Exclusion from a Conservation Policy: Negative Behavioral Spillovers from Targeted Incentives (October 2013). Duke Environmental and Energy Economics Working Paper EE 13-06, Available at SSRN: https://ssrn.com/abstract=2467666 or http://dx.doi.org/10.2139/ssrn.2467666

Francisco Alpizar (Contact Author)

Tropical Agricultural and Higher Education Center ( email )

Turrialba
Costa Rica

Anna Norden

University of Gothenburg - Department of Economics and Statistics ( email )

Box 640
Vasagatan 1, E-building, floor 5 & 6
Göteborg, 40530
Sweden

Alexander Pfaff

Duke University - Policy, Economics, Environment ( email )

201 Science Drive
Box 90312
Durham, NC 27708-0239
United States

Duke University - Department of Psychology and Neuroscience ( email )

Durham, NC 27708
United States

Juan Robalino

Universidad de Costa Rica - School of Economics ( email )

San Jose
Costa Rica

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
67
Abstract Views
832
rank
403,521
PlumX Metrics