Can collective conditionality improve agri-environmental contracts? From lab to field experiments

Individual subsidy payments that are conditional on a collective contribution threshold could provide viable resolution to the insufficient and dispersed adoption of agri-environmental contracts aiming at attaining environmental quality targets. Indeed, in decontextualized laboratory experiment based public goods game (TPGG), Le Coent et al. (2014) offer promising results regarding compared an unconditional (i.e., standard existing schemes). In this article, we propose improve external validity these by transposing lab-in-the-field setting with farmers. To do so, carry out contextualized farmers explicitly mentioning water quality. Our show cooperate even more successfully than students sustain efficient outcomes over time. between-subject comparison, our indicate average group contributions under mechanisms not significantly different. We find is due two behavioral responses (perceived risks initial beliefs others’ contributions) treatment, which have opposing effects cancel each other out. The incentive mechanism thus shows potential as tool for policy since it avoids pay-for-nothing trap without discouraging contributions.