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Category: Experiments

Temporary PES do not crowd out and may crowd in lab-in-the-field forest conservation in Colombia

Published January 1, 2023 by Alex Pfaff
Lina Moros, Maria Alejandra Velez, Daniela Quintero, Danny Tobin, Alexander Pfaff
Ecological Economics 204 (2023) https://doi.org/10.1016/j.ecolecon.2022.107652

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Payments for ecosystem services (PES) programs exist globally and at times shift behaviors. Unlike protected areas, PES compensate land users, raising local acceptance of conservation. Yet some worry that if payments are temporary, as is often the case, conservation behaviors can be reduced by PES, ‘crowded out’ to be lower after PES than if no PES had existed. We conducted lab-in-the-field experiments in Colombia, where PES policies are expanding, offering either individual or collective conditional payments to 676 farmers who are potential PES participants. Those payments end, within each experimental session, for all or only for some participants. We consistently find that conservation is not lower after PES than before. Also, conservation contributions tend to fall over time without PES, in keeping with public-goods literatures. Taken together, these results imply that even after our payments end, conservation is above the baseline defined by our controls, suggesting some form of (at least short-run) crowding in.

 

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Leaders’ distributional & efficiency effects in collective responses to policy: Lab-in-field experiments with small-scale gold miners in Colombia

Published February 1, 2021 by Alex Pfaff
Luz A. Rodriguez, Maria Alejandra Velez, Alexander Pfaff
World Development 147 (2021) https://doi.org/10.1016/j.worlddev.2021.105648

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Globally, small-scale gold mining (SSGM) is an important economic option for many rural poor. It involves local uses of shared resources, like common-pool contexts for which self-governance has avoided ‘tragedies of the commons’. Yet even ideal local governance of SSGM is not societally efficient given non-local damages that suggest external interventions for desired shifts. Because transactions costs are high for rewarding reductions in damages on remote mining frontiers, states could gain if rewards based on low-cost, group compliance measures could successfully induce cooperation in response to policy. However, as group-level rewards invite free-riding, such success requires local collective action. Since that guarantees neither efficient coordination nor equitable distributions of net benefits from compliance, we consider the impacts of emergent leaders on local responses to external policy. We employ framed lab experiments with 200 small-scale gold miners in Colombia’s Pacific to explore leaders’ impacts on equity and efficiency in collective responses to external incentives. Allowing communication before individual choice, which raises efficiency but not always equity, we can identify emergent leaders of groups’ communications. Leaders raise compliance and affect how its costs are distributed, suggesting access to leadership roles matters.

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Graduated stringency within collective incentives for group environmental compliance: Building coordination in field-lab experiments with artisanal gold miners in Colombia

Published November 1, 2019 by Alex Pfaff
Luz A. Rodriguez, Alexander Pfaff, Maria Alejandra Velez
Journal of Environmental Economics and Management 98 https://doi.org/10.1016/j.jeem.2019.102276

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Small-scale gold mining is important to rural livelihoods in the developing world but also a source of environmental externalities. Incentives for individual producers are the classic policy response for a socially efficient balance between livelihoods and the environment. Yet monitoring individual miners is ineffective, or it is very costly, especially on frontiers with scattered small-scale miners. We ask whether monitoring at a group level effectively incentivizes cleaner artisanal mining by combining lower-cost external monitoring with local collective action.We employ a mining-framed, threshold-public-goods experiment in Colombia’s Pacific region, with 640 participants from frontier mining communities. To study compliance with collective environmental targets, we vary the target stringency, including to compare increases over time in the stringency versus decreases. We find that collective incentives can induce efficient equilibria, with group compliance — and even inefficient overcompliance — despite the existence of equilibria with zero contributions. Yet, for demanding targets in which the reward for compliance barely outweighs the cost, compliance can collapse. Those outcomes improve with past successes for easier targets, however, so our results suggest gain from building coordination via graduated stringency.

 

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Contracts versus Trust for Transfers of Nature’s Services: equity and efficiency in resource allocation and environmental provision

Published October 16, 2018 by Alex Pfaff
Alexander Pfaff, Maria Alejandra Velez, Amar Hamoudi, Renzo Taddei, Kenneth Broad
Water Resources & Economics 2018 http://dx.doi.org/10.1016/j.wre.2018.04.001

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Managing natural-resource allocation and environmental externalities is a challenge. Institutional designs are central when improving water quality for downstream users, for instance, and when reallocating water quantities including for climate adaptation. Views differ on which institutions are best: states; markets; or informal institutions. For transfers of ecosystem services, we compare informal trust-based institutions to enforced contracts, both being institutional types we observe commonly in the field. The trust-based institutions lack binding promises, thus ecosystem-services suppliers are unsure about the compensation they will receive for transferring services to users. We employ decision experiments given the shortcomings of the alternative methods for empirical study of institutions, as well as the limits on theoretical prediction about behaviors under trust. In our bargaining game that decouples equity and efficiency, we find that enforced contracts increased efficiency as well as all measures of equity. This informs the design of institutions to manage transfers of ecosystem services, as equity in surplus sharing is important in of itself and in permitting efficient allocation.

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Spillovers from Targeting of Incentives: exploring responses to being excluded

Published October 2, 2017 by Alex Pfaff
Francisco Alpizar, Anna Norden, Alexander Pfaff, Juan Robalino
Journal of Economic Psychology 59:87-98 http://dx.doi.org/10.1016/j.joep.2017.02.007

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A growing set of policies involve transfers conditioned upon socially desired actions, such as attending school or conserving forest. However, given a desire to maximize the impact of limited funds by avoiding transfers that do not change behavior, typically some potential recipients are excluded on the basis of their characteristics, their actions or at random. This paper uses a laboratory experiment to study the behavior of individuals excluded on different bases from a new incentive that encourages real monetary donations to a public environmental conservation program. We show that the donations from the individuals who were excluded based on prior high contributions fell significantly. Yet the rationale used for exclusion mattered, in that none of the other selection criteria used as the basis for exclusion resulted in negative effects on contributions.

 

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Framed field experiment on resource scarcity & extraction: path-dependent generosity within sequential water appropriation

Published July 1, 2015 by Alex Pfaff
Alexander Pfaff, Maria Alejandra Vélez, Pablo Andres Ramos, Adriana Molina
Ecological Economics 120 (2015) 416–429

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How one treats others is important within collective action. We ask if resource scarcity in the past, due to its effects upon past behaviors, influences current other-regarding behaviors. Contrasting theories and empirical findings on scarcity motivate our framed field experiment. Participants are rural Colombian farmers who have experienced scarcity of water within irrigation. We randomly assign participants to groups and places on group canals. Places order extraction decisions. Our treatments are sequences of scarcities: ‘from lower to higher resources’ involves four rounds each of 20, 60, then 100 units of water; ‘from higher to lower resources’ reverses the ordering. We find that upstream farmers extract more, but a lower share, when facing higher resources. Further they take a larger share of higher resources when they faced lower resources in earlier rounds (relative to when facing higher resources initially). That is inconsistent with leading models of responses to scarcity which focus upon one’s own gain. It is consistent with lowering one’s weight on others to, for instance, rationalize having left them little. Our results suggest that facing higher scarcity can erode the bases for collective actions. For establishing new institutions, timing relative to scarcity could affect the probability of success.

 

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