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Public Benefits, Private Benefits, and Policy Mechanism Choice for Land-Use Change for Environmental Benefits

Land Economics · 2008 · 278 citations · 15 references

TL;DR

Policy mechanisms for environmentally beneficial land‑use change should be chosen based on the relative magnitudes of private and public net benefits. The authors develop a decision map recommending positive or negative incentives, extension services, technology development, or inaction depending on whether private net benefits are near zero, public benefits are extreme, or private costs exceed public benefits. JEL codes: Q58, Q24.

Abstract

<i>The choice of policy mechanisms for encouraging environmentally beneficial land-use change should depend on the relative levels of private (or internal) net benefits, and public (or external) net benefits. A map of recommended policy mechanisms is developed, depending on the relative levels of these variables. Positive incentives, negative incentives, and extension need to be targeted carefully to appropriate projects—where private net benefits are closer to zero, and/or public net benefits are more extremely positive or negative. Technology development is suggested where private net costs outweigh public net benefits. No action is recommended for many potential projects</i>. (JEL Q58, Q24)