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Quality Information and Procurement Auction Outcomes: Evidence from a Payment for Ecosystem Services Laboratory Experiment
Author(s) -
Conte Marc N.,
Griffin Robert M.
Publication year - 2017
Publication title -
american journal of agricultural economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.949
H-Index - 111
eISSN - 1467-8276
pISSN - 0002-9092
DOI - 10.1093/ajae/aaw096
Subject(s) - common value auction , business , quality (philosophy) , payment , economic rent , ecosystem services , information asymmetry , procurement , environmental economics , information quality , action (physics) , microeconomics , marketing , ecosystem , economics , information system , finance , electrical engineering , biology , engineering , physics , quantum mechanics , ecology , philosophy , epistemology
Abstract Procuring agencies in conservation auctions typically have more information about the ecosystem service (ES) quality of conservation actions than landowners and can affect auction outcomes by controlling participants’ access to this information. Our induced‐value laboratory auction experiment explores the impact of sellers’ access to ES‐quality information on auction efficiency when the conservation action choice is endogenous to offer formation. We find that providing ES‐quality information allows sellers to identify and submit higher‐quality conservation actions, an effect that counteracts previously identified efficiency losses from information rents.