This article measures farmers' innovativeness and the effectiveness of a priming nudge on their (stated) intention to adopt an innovation, namely the French "Low-carbon label" (LCL). The LCL is an innovative certification framework that provides farmers with a potential new "green business model," enabling them to generate income through the sale of certified carbon credits earned by reducing their own greenhouse gas (GHG) emissions. Using 6,005 responses to an online survey with French farmers, we validate an original scale designed to measure farmers' capacity to innovate and find that innovativeness is positively correlated with stated intention to adopt the LCL. We then evaluate with a randomized experiment included in the questionnaire the net impact of a priming nudge, defined as exposure to a lexical field designed to unconsciously activate psychological factors, and implemented here with references to innovation in order to target the most innovative farmers. We show that the nudge has no detectable impact on the surveyed sample: it neither increases adoption intentions among the most innovative farmers nor discourages the less innovative ones. This absence of effect leads us to discuss the effectiveness of nudges when trying to influence farmers' high-stakes decisions.

The EU has set an objective of reaching 10% of landscape features on its agricultural land by 2030 as part of its latest Biodiversity Strategy. This share is often considered the minimum amount of semi-natural habitats required to halt biodiversity declines and ensure the provision of ecosystem services. This policy objective has faced considerable political opposition due to potentially high budgetary and opportunity costs. We explore farmers' preferences towards hypothetical incentive schemes that ensure the provision of 10% of semi-natural habitats at the landscape level. We use the results of a discrete choice experiment to estimate the total budgetary costs of different schemes and potential strategies to reduce these costs. Finally, we examine regional patterns of farmers' enrolment under various policy scenarios. We find that farmers, on average, demand 21 & euro;, 33 & euro; and 29 & euro; per ha of the entire farm to provide 1% of extensive meadows, woody landscape features and fallow land, respectively. While the total cost of reaching the 10% semi-natural habitat goal at the landscape level drastically exceeds the currently available budget when all farmers contribute equally, the costs can be considerably reduced if an auction-like mechanism is used. Our results show that to reach 10% of semi-natural habitats cost-effectively, careful policy design is required in terms of scheme flexibility and farm-level contributions that are aligned with local conservation targets and the desired scale of implementation.

Conservation auctions are designed to allocate payments for environmental services to voluntary farmers. The auctioneer may announce either the maximum number of contracts (target-constrained auction) or, more commonly, the total budget available (budget-constrained auction). Building on previous work that compared these two formats, we introduce a new double-constraint auction, where both constraints-set at the same levels as in the benchmarks-are simultaneously disclosed to participants. Using the same experimental methodology, we assess performance consistent with a generic policy objective: maximizing environmental benefits while minimizing expenditures. On average, the double-constraint auction outperforms both target- and budget-constrained formats.

France's Common Agricultural Policy Strategic Plan introduces a coupled aid program to support small-scale market gardening farms. This study, using data from a discrete choice experiment and national-level simulations, compares the projected outcomes of this new program-which has strict eligibility requirements-with those of an alternative scheme inspired by the CAP's Small Farmers Scheme (SFS), where farms self-select to receive lump-sum payments. Results indicate that the SFS+ (including environmental and employment conditions) may effectively promote agro-ecological transition in the market gardening sector and could serve as a valuable recommendation for revisions to France's strategic plan and those of other Member States.

Reverse auctions, also known as procurement auctions, are used in various fields by public or corporate buyers to purchase goods and services from multiple sellers at the best price. Unlike in selling auctions, in reverse auctions a budget constraint rather than a target quantity is often announced by the auctioneer. However, in auction theory no equilibrium bidding strategy has yet been found in the case when a budget constraint is announced. Here we compare the two auction formats in an online experiment with 329 participants. We use the strategy method to obtain participants' bidding strategies from which we run exhaustive simulations of auction outcomes to define equivalent target and budget constraints. This original methodology allows to overcome the issue of randomness of the auction outcome related to bidders' values and to compare the two formats in a rigorous way. When each bidder has a single unit to sell, from the buyer's perspective, we find that, on average, the budget-constrained auction format outperforms the target-constrained auction format.

Nudges are increasingly used to alter the behavior of economic agents as an alternative to monetary incentives. However, little is known as to whether nudges can backfire, that is, how and when they may generate effects opposite to those they intend to achieve. We provide the first field evidence of a nudge that is designed to encourage pro-environmental behavior, which instead backfires. We randomly allocate a social comparison nudge inviting winegrowers to adopt biological pest control as an alternative to chemical pesticide use. We find that our nudge decreases by half the adoption of biological pest control among the largest vineyards, where the bulk of adoption occurs. We show that this result can be rationalized in an economic model where winegrowers and winegrower-cooperative managers bargain over future rents generated by the adoption of biological pest control. This study highlights the importance of experimenting on a small scale with nudges aimed at encouraging adoption of virtuous behaviors in order to detect unexpected adverse effects, particularly in contexts where negotiations on the sharing of the costs of adoption are likely to occur.

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

We use a discrete choice experiment with treatments to test if voluntary adoption of smart water meters by French farmers can be fostered by (i) a collective conditional subsidy offered to farmers who adopt a smart meter only if the rate of adoption in their geographic area is sufficiently high and (ii) informational nudges. Using a sample of 1,272 farmers, we find contrasted results regarding our nudges, but we show that a conditional subsidy is an effective tool to foster adoption of smart meters. Interestingly, the willingness to pay for the conditional subsidy is equal to the subsidy amount and independent of the collective adoption threshold.

The environmental benefits from Payment for Ecosystem Services (PES) schemes can often be enhanced if private land managers are induced to enrol land in a spatially coordinated manner. One incentive mechanism which has been proposed to achieve such spatial coordination is the agglomeration bonus, a two-part payment scheme which offers a pecuniary (financial) reward for decisions that lead to greater spatial coordination of enrolled land. However, farmers respond to a range of motives when deciding whether to participate in such schemes, including non-pecuniary motives such as a concern for the environment or social comparisons. This study implements a de-contextualised laboratory experiment to test the effectiveness of the agglomeration bonus when non-pecuniary motives are explicitly incorporated into the decision-making environment. We capture intrinsic preferences for the public good dimension of environmental improvement through a real donation to environmental charities and examine the relative impact of a group-ranking nudge. The experimental results show that the agglomeration bonus does indeed improve participation and spatial coordination when non-pecuniary motives are accounted for, but that its performance is not enhanced by the nudge.

Agri-environmental schemes (AES) are part of the main tools used by decision makers to trigger a transition in agricultural practices but one of the factors that discourages farmers from enrolling is the uncertainty of the costs and benefits associated with the adoption of the new practices. In this study, we distinguish between the “internal uncertainty” that is related to the characteristics of the farmer and his/her parcels and “external uncertainty”, which is related to the occurrence of external events. We propose three innovations to better account for uncertainty in AES design: the possibility to suspend the conditions of the contract for one year, an opt-out option after three years and the opportunity for farmers to share their experience in peer-groups. We test their attractiveness through a choice experiment and analyze our results using a mixed logit model. We find that proposing AES that allow suspending the conditions of the contract for one year enhances participation.

Le regulateur qui met en place une enchere agro-environnementale annonce generalement le budget dont il dispose et alloue les contrats aux agriculteurs jusqu’a epuisement du budget. Cependant, la theorie des encheres considere plutot des encheres dans lesquelles c’est le nombre d’unites en vente qui est annonce et qui permet de calculer la strategie d’enchere optimale. Aucune prediction theorique ne permet de savoir quelle est la strategie optimale (ni meme si elle existe) lorsque c’est le budget qui est annonce. La question est donc de savoir comment jouent les encherisseurs dans ce type d’enchere et finalement quel est le format d’enchere (contrainte d’objectif ou contrainte de budget) qui permet d’obtenir le plus de benefices environnementaux au moindre cout. Nous proposons une experience en laboratoire pour mieux comprendre les strategies des joueurs dans ces deux formats d’encheres. Notre principale contribution est l’utilisation de la strategy method afin de disposer de la strategie complete d’enchere dans les deux formats. Nous trouvons que les strategies des sujets sont significativement differentes de la strategie theorique optimale dans l’enchere avec contrainte d’objectif. Ce premier resultat ne nous permet pas de comparer directement les deux formats d’enchere, car le budget annonce est le budget moyen « theorique » dans l’enchere avec contrainte de budget. Cependant, en ayant fait jouer les deux formats d’enchere aux memes sujets, nous mettons en evidence un effet d’ordre qui nous conduit a penser qu’il est plus difficile d’encherir dans les encheres avec contrainte de budget que dans celles avec contrainte d’objectif.

The economic literature on Payments for Environmental Services (PES) has studied extensively the behavioural factors that prevent farmers from signing PES contracts, even when the payments exceed the expected opportunity costs. This article provides a theoretical model of the role played by the interplay of descriptive and injunctive social norms in farmers’ decisions. When they choose to contribute voluntarily to an environmental public good, farmers may be driven by descriptive norms akin to conformity (do as the majority of their peers) as well as by injunctive norms (in line with what society expects them to do), which are the equivalent of a social injunction to act in favour of the environment. The interactions between these two social norms can yield multiple equilibria, depending on the relative weight of the descriptive norm (sensitivity to conformism) and of the injunctive norm (sensitivity to moral pressure) in the utility functions of farmers. More generally, our model can explain why social groups are sometimes trapped in low public-good-contribution equilibria, even when public subsidies to contributors are high. We make policy recommendations to help reach higher contribution equilibria, with a specific focus on the farm policy context.

The 2014 CAP introduced the Small Farmers Scheme (SFS), offering small farms the option of an unconditional annual lump-sum payment per farm replacing the standard first pillar direct payments. This paper assesses the acceptability in France of an extended version of the 2014 SFS for the post-2020 CAP: it includes conditions on farmers' environmental efforts and on salaried employment. The results of a discrete choice experiment conducted at the scale of France with 608 farmers receiving less than 15,000€ in first pillar payments show that an SFS with an environmental certification prerequisite is attractive to French small farmers, notably in the market gardening sector. We provide simulated results of the uptake rate and budgetary impacts of different SFS scenarii on the population of non-retired French farmers based on the last agricultural census.

Nearly all Agri-Environmental Schemes (AES) offer farmers stable annual payments over the duration of the contract. Yet AES are often intended to be a transition tool, thus decreasing payment sequences would appear particularly attractive for farmers. The standard discounted utility model supports this notion by predicting that individuals will prefer a decreasing sequence of payments if the total sum of outcomes is constant. Nevertheless, the literature shows that numerous mechanisms, such as increasing productivity, anticipatory pleasure and loss aversion can incline farmers to favor an increasing sequence of payments. To understand what drives farmers? preferences for different payment sequences, we propose a review of the mechanisms highlighted by the liter-ature in psychology and economics. We then analyze farmers? preferences for stable, increasing or decreasing payments through a choice experiment (CE) survey of 123 French farmers, about 15% of those contacted. Overall, farmers do not present a clear willingness to depart from the usual stable payments. Moreover, we find a significant aversion to decreasing payments in farmers with a lower discount rate and in those more willing to take risks than the median farmer, contradicting the discounted utility model.