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Going Green To Be Seen: The Case of Biodiversity Protection on Farmland

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  • Prasenjit Banerjee
  • Ada Wossink
  • Rupayan Pal

Abstract

We provide a framework to analyze the non-separability of self-interest and endogenous social preferences in the context of voluntary biodiversity protection on farmland. A farmer’s social reward (esteem/disesteem) interacts with the proportion of the peer group taking up the conservation practice. We use the framework to address how to incentivize different types of farmers (‘green’ or brown’) under asymmetric information about their true motivation. It follows that under perfect Bayesian equilibrium, the regulator can separate out the farmer types by monitoring their (observable) conservation activities and that a status reward is needed to keep ’green’ farmers interested.

Suggested Citation

  • Prasenjit Banerjee & Ada Wossink & Rupayan Pal, 2017. "Going Green To Be Seen: The Case of Biodiversity Protection on Farmland," Economics Discussion Paper Series 1701, Economics, The University of Manchester.
    • Handle: RePEc:man:sespap:1701
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    File URL: http://hummedia.manchester.ac.uk/schools/soss/economics/discussionpapers/EDP-1701.pdf
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    Cited by:

    1. Karine Nyborg, 2020. "No Man is an Island: Social Coordination and the Environment," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 76(1), pages 177-193, May.

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    More about this item

    JEL classification:

    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • Q57 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Ecological Economics
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

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