Farmers’ Perceptions of Payment by Results scheme in UK

Farmers’ Perceptions of Payment by Results scheme in UK

Earlier this year, researchers from the UK ‘Contracts2.0’ team spent some time working with Natural England and the Yorkshire Dales National Park’s Pilot Results Based Agri-environment Payment Scheme (RBAPS) to study farmers’ perceptions of this results-based pilot project. Another focus of the joint study was to identify the changes to the management practices as well as the habitat quality of the farmland resulting from the participation in this results-based scheme.

 We found that farmers had very positive experiences of the payments by results scheme and, overall, habitat quality was at a comparable level to control sites in conventional agri-environmental agreements. This can be seen as a success considering the relatively short timescale of the project and the additional empowerment of farmers within PBR approaches. Interestingly, many farmers chose to maintain many of their existing management practices, rather than aim to improve the habitat quality as we might expect in a results-based system. Farmers recognised a relationship between their existing habitat quality and the cultural & environmental heritage of the landscape, where unique elements of the area such as ancient flower meadows resulted in sufficient payments. Farmers also noted some important factors outside of their control which impacted management, from the weather conditions to the valuable advice and support received from local project officers.

Our report was submitted to the UK Government’s Department for Environment, Food & Rural Affairs, as a part of the supplementary evidence relating to the ongoing RBAPS trial and development of the new Environmental Land Management Schemes (ELMS) in England.

Project Outline

We conducted detailed interviews with farmers involved in the RBAPS pilot in January 2021. The interviews lasted on average for approximately 1 hour 30 minutes, with the shortest interview being just over 1 hour and the longest being 2 hours and 30 minutes. The interviews took place either online via video call (on Skype, Microsoft Teams, Zoom or WhatsApp) or over the telephone. To ‘map’ the farmers’ land management timelines and to compare any changes to management before and during the pilot, we used an interactive online platform called Mural to show farmers the timeline as we were making it. The RBAPS pilot in Wensleydale and Coverdale is focused on Grassland habitats for breeding waders and species rich hay meadows. The upland environments of many of England’s National Parks, and across the UK’s CIL area in the Contracts project, are in many ways ideal landscapes for the delivery of these types of environmental public goods, alongside numerous others.

Figure: Example of a Land Management Timeline made during the interview on Mural

Land Management Approaches in Results-Based Schemes

Motivations and Objectives in Results-based Approaches

One of the most important factors we identified through our in-depth interviews was a distinction between farmers who aim to ‘improve’ habitat quality and those who aim to ‘maintain’ it through results-based schemes. This distinction between ‘improvers’ and ‘maintainers’ appeared both in terms of motives for habitat quality and the management strategies the farmers employed. The objective of maintaining habitat quality might appear to run counter to the conventional assumption in results-based approaches that farmers will be incentivised to ‘do more to get more’. Though initially surprising, farmers explained that their reasoning for maintaining habitats were many-sided and varied from the short-term scope of the pilot to the existing relatively high standard of their habitats, detailed further below. 

Figure: Tracing Farmers’ Land Management Goals in PBR

Environmental Heritage in Protected Areas

Where we found that many farmers were content to maintain the quality of the habitats that they already had, several farmers said that some long-existing cultural environmental features of these habitats, which are unique to protected landscapes, were reasons for their existing good standard. So, where farmers have sought to maintain existing habitats, alongside pragmatic factors of management, they also emphasised the already high-value heritage features of their habitats. These include features more common in National Landscapes, such as

  • long-existing uncultivated hay meadows with rare and ancient seeds,
  • local & traditional land and animal management practices such as making small hay bales
  • locally unique cultural and environmental landscape features such as hay barns

To illustrate, hay barns, for example, are not only highly valued by tourists as beautiful, picturesque features of the Yorkshire Dales National Park, they also hold an important traditional role in practices of small hay bale making, as they enable farmers to house the hay close to the place it was made and where it will be needed for livestock in winter months. Furthermore, this process is one of the most environmentally friendly practices of producing storable forage: the ‘tedding’ (or drying process) redisperses seeds across the meadow. Traditional small bale hay making also avoids issues of soil compaction, where larger bales necessitate heavier machinery, and remove the use of plastic, which is needed to wrap grass for fermentation in silage or haylage production. Therefore, we can see that many of these ‘environmental heritage’ features have both environmentally and culturally valuable qualities which are unique to England’s protected landscapes. 

 

Figure: Hay Barns in Wensleydale (Image © James LePage)

Administration and Support in a Results-Based Pilot

Another factor which was universally identified by farmers as a huge benefit of the results-based approach was the scheme administration. Beyond the highly valued simplicity and flexibility offered by results-based contracts (in contrast to the demanding and complicated paperwork of England’s existing action-based schemes) farmers also emphasised the key role that the National Park Authority (NPA) officers played in scheme support and delivery. Farmers highlighted that the role of the NPA’s local officers in scheme design, information provision, training, and dialogue was fundamental to scheme uptake and success. For the broader developments of results-based schemes, local or regional organisations such as NPAs are, in many ways, well placed to be important intermediary facilitating bodies for these roles.

Issues out of their control: Adverse weather

Farmers also emphasised their habitats’ vulnerability to the impact of the weather, including extreme flooding or conversely, unexpected dry spells. Almost all the farmers made several comments about the negative effect of the weather, particularly when this was combined with differing assessment timings, upon their habitat scores. This vulnerability has important consequences for ‘pure’ results-based schemes, and indicates that ‘hybrid’ schemes, which combine results and action-based, might help to reduce some of the risk to farmers from issues outside of their control.

Disseminating our results

Following our interviews and analysis, we complied a detailed report which was submitted to DEFRA alongside Natural England’s main summary of the Pilot to date. We were also delighted to present some of our recent research into participant farmers’ opinions on payments by results as a part of a national conference ‘Farming with Nature’. This conference, convened by the University of Cumbria, aimed to explore how nature can be delivered within our farmed ‘National Landscapes’, namely England’s main protected areas such as National Parks and Areas of Outstanding Natural Beauty (AONBs). This approach was a key recommendation from the Landscapes Review.

Future Directions for Wensleydale RBAPS

The pilot is currently running under another extension funded by DEFRA and is exploring alongside the participating farmers how future schemes might work better: Either as ‘hybrid’ schemes which combine elements of action and results-based approaches, or at varying scales which might plan agreements at farm or even landscape levels, rather than individual field parcels.

For more information read our full report regarding Farmers’ Experiences of Results-based contracts in Wensleydale or contact me at Jennifer.dodsworth@abdn.ac.uk or @JennyferDods on Twitter.

Implementing innovative contract models – results from the Policy Delphi

Implementing innovative contract models – results from the Policy Delphi

The second round of our online Policy Delphi study – focusing on opportunities to implement innovative contract models in the current policy arena – was closed during the summer, and the first results are just fresh out of the oven.

A key characteristic of the Delphi method is that it runs in several consecutive rounds. This allows the researchers to use the findings from the preceding rounds to design questions in the forthcoming rounds. This allows to dig a little deeper into the most exciting (often controversial) topics, which is exactly what happened in Contracts2.0. The results of our first Delphi round were analysed to identify converging and contested topics, which were then turned into questions and statements to test in the second round of the survey. 32 experts from 15 European countries participated in the second round, with almost half of them indicated to have direct policy experience at national or subnational level.

Based on the answers from the first round on how the ideal contract would look like to incentivize farmers for more sustainable farming we could synthesize three prototypes: a) a mixed contract combining action-based and result-based elements, signed bi-laterally between farmers and funding agencies for a medium duration (5-7 years); b) a result-based contract, signed between a group of farmers (collective) and the funding agency, with flexible duration (from short to medium or long term); and c) a value-chain contract, signed between farmers and other actors of the value chain (e.g. food processors, retailers, certifiers), which builds on an existing AECM contract and provides a price premium for more sustainable products. As the figure (above) suggests, the majority of the respondents would choose a mixed, action- and results-based contract for an European level contract prototype, but still almost one-quarter of the respondents would suggest alternative contracts, mainly ones which offer more flexibility to choose collective (landscape-level) agreements or different contract lengths from shorter to longer term.

We also asked what the best way is to implement these novel contracts, and there seems to be an agreement about agri-environmental-and climate measures still being the main target area, where innovative contract characteristics can be implemented as top-ups or additional payments to more mainstream conventional (i.e. action-based) contracts. In terms of funding novel contracts through the Common Agricultural Policy, responding experts underlined the outstanding importance of the Pillar 2 payments. Within Pillar 2 policy instruments, almost 70% of the participants pointed to agri-environmental and climate measures, while voluntary interventions in Pillar 2 for investment, knowledge exchange and cooperation, as well as for ecological constraints were listed by 34.5%. Eco-schemes, which is a part of the new green architecture affiliated with the Pillar 1 payments, were also mentioned by 34.5% of the respondents – with this proportion, eco-schemes seem to be the most promising instrument within Pillar 1 with a considerable potential to integrate innovative contracts.

As we learned from the first round of the Delphi study, available budget is a strong constraint for implementing innovative contracts (beside others, like increased transaction costs or higher uncertainties). Financially supporting environmentally friendly farming through different instruments of the CAP, as suggested by the findings shared above, can be a strategy to alleviate the budget burden. However, it raises further questions such as additionality and potential double-payments received for the same result from different schemes. Fostering coherence within the CAP and between the CAP and other policy areas is a key step forward and will also be a focal topic of the third round of our Delphi study.

written by Eszter Kelemen & Boldizsár Megyesi (ESSRG)

 

For infos on tools and techniques for initiating a policy dialogue on innovative approaches check our Practice Abstracts no. 10

Collective AES – exploring Dutch farmers’ motivation to participate

Collective AES – exploring Dutch farmers’ motivation to participate

To address the degradation of the natural environment, agri-environment schemes (AES) have been designed within the European Union’s Common Agricultural Policy. AES have been criticised for showing low ecological effectiveness. To improve the schemes’ effectiveness, a collective approach focusing on a landscape level as opposed to a single field or farm level is recommended. So far, this approach has rarely been applied across Europe. The Netherlands is an exception, where all AES have to be implemented collectively since 2016. Participation for farmers in the schemes is voluntary. Therefore, understanding farmers’ motivation to join is crucial as the uptake and implementation of measures is a prerequisite for achieving any effects.

In early 2021, we interviewed 15 farmers from six Dutch collectives about their motivation to participate in collective AES and assessed the advantages and disadvantages of collective AES from the participating farmers’ perspective.

Overview collectives participating in the study

Figure 1. Overview of participating collectives.

Methodological approach

We carried out a Q-study to learn what motivates farmers to join collective AES. Q methodology explores different perspectives on a topic by combining quantitative and qualitative elements within an interview. For the quantitative part, we asked farmers to sort 37 statements into a grid. The grid ranged from -4 (disagreement) to +4 (agreement) and allowed the participants to sort the statements relative to each other depending on their personal level of (dis)agreement. We developed the statements based on an extensive literature review, capturing as many different aspects of the debate as possible. In the qualitative part of the interview, the farmers could comment on the statements, explain their sorting choices and talk about the advantages and disadvantages of the schemes.

Filled in Q-grid

Figure 2. Example of statement sorting, with red (disagree), green (agree) and grey (neutral) statements.

Motivation to join collective AES

The analysis revealed three motivational views: collective-oriented, business-oriented and environment-oriented. Farmers sharing the collective-oriented perspective (‘the collectivists’) feel a stronger connection to the collective and are proud of common achievements. The business-oriented perspective (‘the business rationalists’) is shared by farmers who think rationally about their farm business and how collective AES and other actions fit the overall operative purpose. Within the environment-oriented perspective (‘the environmental optimisers’), farmers care strongest about the environment and how their farm can actively engage in biodiversity or climate protection.

All farmers share great affection and care for nature. They agree that taking care of the environment is part of being a good farmer. They appreciate the collectives’ collaboration with nature conservationists and citizens. Financial compensation for the measures is important, however, it is viewed as a necessity to enable required changes in farming practices rather than an additional source of income. Individual independence is crucial to all participating farmers, yet, they don’t think that cooperation within the collective threatens their autonomy but rather strengthens it. All farmers strongly reject the idea of having joined the scheme because of fellow farmers’ participation. They do not necessarily trust that their neighbours are good partners for cooperation. At the same time, they are not afraid that someone in the collective would benefit without contributing. While it is central for them that people acknowledge their efforts within the schemes, they do not perceive pressure by society that would influence their actions.

Advantages and disadvantages of collective AES

The collective scheme offers many advantages to farmers, notably improved ecological impacts and support from the collectives. Farmers appreciate that the collectives assist with applications and administrative tasks and facilitate exchange with fellow farmers, creating room for discussions, mutual learning, inspiration, and network building. Another significant advantage is the provision of knowledge and advice with close contact between farmers and the collectives’ field workers, who speak the farmers’ language and know what’s going on in the region.

However, farmers still wish for more flexibility and a better integration of their knowledge and experiences into scheme design and decision-making processes. Policy processes should be transparent and promises should be kept to avoid disappointment and mistrust. The consequences of joining the schemes should be communicated openly to prevent farmers’ concerns about raising conservation standards and land possibly becoming protected and excluded from farming activities. It might be worth evaluating the possibility of providing voluntary long-term contract options for certain measures to allow for better planning. Also, the government should guarantee sufficient funding to enable all applying farmers to join the schemes.

Communication with the public can still be improved to better show farmers’ achievements. Also, between the different collectives, communication could be enhanced to allow for a better exchange. A prime example is the approach to tackle predation in meadow bird management, which in some collectives works better than in others.

Outlook

A large-scale survey-based follow-up study, including non-participants in collective AES, would be needed to reach representative results. Many of the caveats for collective AES described in the literature were not confirmed, some of them were even explicitly dismissed by all participating farmers, for instance, the fear of depending on others or the risk of others benefitting without contributing. The findings indicate a potential to promote the Dutch approach to AES in other regions if organisations similar to the Dutch collectives exist (or develop), which would offer the necessary support for farmers.

In Contracts2.0, we will continue to explore how the Dutch approach can be enhanced and how AES can best be implemented collectively in other European regions, such as the French CIL Hautes-Pyrénées, the Belgian CIL Flanders or the German CIL NRW.

For more information, see Margarethe Schneider’s master’s thesis.

Economic experiments for improving agricultural policy

Economic experiments for improving agricultural policy

The EU’s Common Agricultural Policy (CAP) is constantly evolving. Its evaluation tools must develop concurrently. Including economic experiments in the toolset would be a valuable complement to capture farmers’ behavior and policy acceptance. economic experiments are highly effective for policy evaluation. They allow testing new policies before implementation, provide evidence on their effects, and identify factors influencing policy outcomes. 

As part of the Research Network of Economics Experiments for CAP evaluation (REECAP), Contracts2.0-collegue Jens Rommel from the Swedish University of Agricultural Sciences contributed to a newly published article in the EuroChoices Journal. “Can Economic Experiments Contribute to a More Effective CAP?,” the authors ask. They examine experiments use in agricultural policy research and discuss their potential to help policy-makers understand farmer decision-making processes better.

 What are economic experiments?

Experiments are situations that allow for the study of decisions in controlled and reproducible environments. Like medical trials, where patients randomly receive medicine or a placebo, farmers are randomly assigned to different “treatments”. Treatments can, for example, simulate situations with and without CAP measures or include alternative measures’ designs. Comparing decisions in the treatments, researchers can isolate the causal impact of the policy and the relative performance of design alternatives.

 Advantages for policy evaluation

That way, experiments provide answers in a short amount of time and at much lower costs than, for example, trial and error in the “real world” would before the policy is implemented. As experiments are based on farmers’ preferences policy design and related incentives can flexibly be adjusted in advance. The use of control groups ensures to distinguish responses to different policy designs from policy effects and external factors.

Current agricultural policy simulators assume profit-maximizing behaviors only. economic experiments often include cultural and other factors, which can generate profound insights into farmers’ complex decision-making processes.

Including economic experiments in the policy evaluation toolbox

Experimental approaches still need to find their place within the policy evaluation cycle. Collaborations between stakeholders involved in agricultural policy-making and research will be vital to ensure that economic experiments will find their place in the CAP evaluation toolbox to support a more effective CAP development.

For more information, see the original article: https://onlinelibrary.wiley.com/doi/full/10.1111/1746-692X.12324

Practitioners picture desirable farming landscapes for 2040 and ideal agri-environmental contracts

Practitioners picture desirable farming landscapes for 2040 and ideal agri-environmental contracts

“How do agricultural practitioners envision desirable farming landscapes and ideal agri-environmental contracts?” In a detailed report, we collect and present answers to this question. We found that practitioners across Europe envision farming landscapes shaped by viable agricultural practices that strengthen and enhance ecosystem services. It is important that actors in the farming systems share the same values, cooperate and mutually recognise each other’s expertise to make the shared vision a reality. The social setting turned out the most critical change driver, followed by the legal and political framework and land use and environmental conditions. In this post, we share some of our key findings to illustrate what practitioners believe is necessary to unite the socio-economic viability of farming with the production of agri-environmental public goods in our farming landscapes.

Developing desired landscapes and dream contracts

To answer our initial question, we carried out 28 workshops and consultations in 13 Contract Innovation Labs (CILs) in nine countries across Europe, with a total of 354 participants over the past year. With farmers, environmental NGOs, nature associations, researchers, agricultural advisors and public administrations, we envisioned dream farming landscapes and ideal agri-environmental contracts to facilitate the sustainable transformation of the farming system (see Figure 1). This approach is based on the potential of positive future visions to stimulate sustainable change within the farming system in a participatory way.

 

Figure 1. Steps from dream contract development to implementation.

Based on key information provided by stakeholders from each CIL we analysed case-specific situations and problems using swot analysis. We then asked CIL participants to picture a desirable future dream landscape in the year 2040. We encouraged participants to prepare lists of enabling and limiting factors for realising the dream landscape. Finally, we asked them to envision agri-environmental contracts that would facilitate transformation toward the desired state. The participants reflected the contracts from different perspectives such as environmental effectiveness, socio-economic viability, duration and monitoring. Lastly, we developed dream contract trajectories – paths to reach the envisioned state.

Common dream landscape patterns

Based on short descriptions the CILs prepared of the dream landscape, we singled out 99 diverse dream landscape elements, which we clustered into eight landscape building blocks: viable and sustainable agriculture, regulating ecosystem services, social cohesion, biodiversity, multifunctionality, enabling landscape managers, health and wellbeing, and cultural ecosystem services. We ordered these building blocks into four almost-equally weighted categories: multifunctionality, agriculture-related topics, environmental-related topics and social context.

The category multifunctionality is relatively broad and refers to the simultaneous provision of different goods and services of the landscape or through agricultural activities. In the category of agriculture-related topics, the most common landscape element is viable and sustainable agriculture. Viable and sustainable agriculture should be profitable, provide opportunities for new generations of farmers, generate and process quality local produce, apply sustainable farming practices, use and produce renewable energy and optimise livestock production. The category of environmental-related topics includes the landscape elements regulating ecosystem services and biodiversity. Social context consists of the elements social cohesion, health and well-being and cultural ecosystem services. Social cohesion is an essential element indicating the importance of cooperation, shared values, the connection between communities and the landscape, and vibrant rural living (see Figure 2).

Figure 2. Representation of the dream farming landscape in CIL Oost-Gronningen. Several dream landscape patterns are illustrated.

Enabling and limiting drivers of change for the dream landscape

Change drivers are natural or human-induced factors that directly or indirectly trigger a change in an ecosystem. Direct drivers, such as habitat conversion and climate change, are pressures that directly affect ecosystem processed. Drivers that operate at a more diffuse level are indirect change drivers, such as socio-political, economic and technological factors.

In total, we identified 130 change drivers in our case studies that we assigned to five themes: social impact, legal policy and political context, land use and environmental impact, agro management viability and economic viability (see Figure 3). Across all cases enabling (N=62) and limiting (N=68) drivers are almost balanced. However, each case has a unique profile, which influences the likelihood of achieving the desired dream landscape. The most common them is social impact. It includes enabling drivers such as increased consumer demand, farmers’ intrinsic motivation and cooperation amongst farmers. The limiting drivers within this theme were a lack of trust and awareness.

 

 

Figure 3. Distribution of change drivers in five themes.

Unlike the three other themes, social impact as well as land use and environmental impact are described mainly by enabling drivers, meaning they are major building blocks for the dream farming landscapes. The limiting drivers are mostly related to economic viability (e.g., market fluctuations), the policy context (e.g., the uncertainty of current and future CAP developments) and agro management viability (e.g., uncertainty on the effects of farming practices) (Figure 4).

 

Figure 4. Limiting and enabling factors across themes.

Dream contracts for dream landscapes

Each CIL developed one or several dream contracts. These dream contracts are legal conduits to strike a balance between farmers’ or land managers’ economic interests and societies’ interests for the provision of environmental public goods and services. We analysed them for general characteristics, benefits, involved actors, payments and monitoring.

General contract characteristics include the targeted land use and contract length. Dream contracts targeted diverse land-use types such as grassland (N=12), arable crops (N=10) and permanent crops (N=7). Often, a contract combines several of these land-use types. The ideal contract length in most CILs ranges from five to ten years.

The dream contracts envision a wide range of benefits that go well beyond mere financial compensations for farmers (Figure 5). Overall, we identified 96 benefits that mostly help either society or farmers.

Figure 5. Envisioned dream contract benefits.

We split the financial benefits for farmers into indirect and direct monetary benefits. Direct monetary benefits include income support, cost savings and product added value.

All cases reported the involvement of one or more intermediary organisations. In eleven out of thirteen cases, a farmer group plays a crucial role to broker knowledge, manage payments, coordinate measures, carry out monitoring and build social cohesion.

In eight out of thirteen cases, funding is envisioned to come from the public sector, for example through agri-environment and climate schemes. Two cases aim for private funding and three cases envision a mix of private and public funding. Generally, we observe great interest for collective and results-based approaches, value-chain contracts and combinations thereof. Six out of thirteen cases like to experiment with combining contracts that include action-based and results-based features.

Almost all dream contracts envision that monitoring is carried out in results-based schemes and action-based schemes. We see a strong willingness from practitioners to be involved in monitoring.

Our results in the greater context

We do not claim that our results represent the whole farming community in Europe as they are entirely based on the perceptions of the participants in our 13 CILs, some of whom participated in several workshops. Furthermore, most participants are already engaged in contracts and are interested in reconciling farmer objectives with societal needs for agri-environmental public goods. Nevertheless, our results give interesting insights into practitioners’ perceptions about desirable changes in present agri-environmental contracts. Practitioners are keen to contribute to societal benefits, experiment with novel contract designs, and play a more active role in designing and monitoring agri-environmental contracts. These findings can support  the design of innovative Agri-environmental contracts and the corresonding policies and Strategic Plans within the New Delivery Model.

To learn more about our findings click HERE.

To learn more about each CIL’s dream landscape and dream contract follow these links:

  1. Limburg – Netherlands
  2. Groningen – Netherlands
  3. Koolstofboeren – Belgium
  4. Gulpdal – Belgium
  5. Northwest England – UK
  6. Hautes Pyrenees – France
  7. Madrid Region – Spain
  8. Bornholm – Denmark
  9. Agora Natura – Germany
  10. Hipp – Germany
  11. North Rhine Westphalia – Germany
  12. Örseg National Park – Hungary
  13. Unione Comuni Garfagnana – Italy

Written by Sven Defrijn (Boerennatuur Vlaanderen), Marina Garcia Llorente (Universidad Autónoma de Madrid), Edward Ott (Leibniz Centre for Agricultural Landscape Research), Photo Title: © Illiya Vjestica on Unsplash

Willingness to collaborate in agriculture?  A behavioural experiment shows positive results

Willingness to collaborate in agriculture? A behavioural experiment shows positive results

Many environmental objectives in agriculture can be better achieved at larger spatial scales through cooperation among farmers. In the Netherlands agri- environmental measures are implemented exclusively within farmer collectives (“Dutch modell”), which develop regional management plans together with the authorities. In a behavioural experiment, we investigated German farmers’ willingness to collaborate with the aim to introduce such an approach to Germany.

The participants’ willingness to collaborate was high and exceeded the expectations of experts. These results provide first positive indications regarding the potential of collaborative agri-environmental schemes (AES) in Germany.

(German version /deutsche Version)

Motivation and goals

There is great interest in the “Dutch approach” of collectively implementing agri-environmental schemes (AES) , since many measures are more effective, when coordinated on a landscape scale, e.g. rewetting of peatlands, protection of habitats or erosion control. The  2019 report of the Scientific Advisory Council at the Federal Ministry of Food and Agriculture therefore also recommends: “(1) Examine the extent to which elements of the Dutch system of collective nature conservation arrangements could also be applicable in Germany; (2) improve the institutional prerequisites for the implementation of collective models of environmental and climate action; (3) in pilot projects in the current finance period, support the grouping of relevant local actors into ‘biodiversity-generating communities”.

However, little is known, about the willingness of farmers to collectively pursue environmental goals. We have investigated this basic willingness in a so-called public goods game.

The public goods game

The public goods game is a concept from game theory (theoretical framework within the field of economics). Players have an initial monetary endowment that must be divided between a private account and a group account. The money in the group account is multiplied by a number that is lower than the number of participants but greater than one. Thus, although it is in the interest of the group, players have no individual incentive to contribute to the group account, although this is in the interest of the group. The game can be used to abstractly study free-rider behaviour and cooperation. Thousands of laboratory experiments show that many people are willing to cooperate with strangers. A typical result is that participants contribute about half of their initial endowment to the group. The figure (above) shows an example with four players and an initial endowment of 10 euros.

The experiment and the survey of experts

Public goods games have already been carried out in many different versions in the laboratory. In our study, we discussed a selection of possible treatments against the background of collaborative agri-environmental schemes at a workshop during the Green Week 2020 in Berlin. In addition to a baseline version, four treatment versions of the game were selected from 17 alternatives for a study with German farmers:

(1) Baseline: four participants must allocate 50 euros between a group account and a private account. The amount on the group account is doubled and divided equally among all players.

(2) Heterogeneous initial endowment: participants have either a high or a low initial endowment;

(3) Leading by example: three participants can first see the decision of the first player and only then make their decision;

(4) Social norm: participants receive the information that many other participants have contributed high amounts to the group account;

(5) Social optimum: participants receive the information that it is in the interest of the group that everyone contributes as much as possible to the group account.

More than 350 farmers participated in our online experiment. Participants were randomly presented with one of the five options. Every tenth participant received a real payment depending on his/her own behaviour and the behaviour of the other participants.

Parallel to the study with the farmers, we asked more than 200 experts from science and practice to predict the behaviour of the farmers in our experiment. Three participants were randomly selected and received a payment depending on the accuracy of their estimate.

Results

For each of the five treatments the figure shows in orange the distribution of the percentage that participants contributed to the group account. In all treatments the average is higher than 50% and, thus, higher than in typical laboratory experiments. The contributions do not differ between the treatments, with the only exception of the social optimum, where contributions are significantly higher and reach 80% of the initial endowment.

The distribution of experts’ predictions is shown in green. Experts underestimate the contributions of farmers by an average of more than twenty percentage points.

Diagram showing farmers' contributions to public good and expert predictions of farmers' contributions to the public good.

Figure 1 Distribution of contributions (orange) and expert predictions (green) Source: own calculations

First conclusions and outlook

The most important conclusion is that participating farmers show a high basic willingness to cooperate under experimental conditions. It has also been shown that experts assess the cooperation behaviour of the participants too pessimistically. In the Contracts2.0 project, we will now discuss these results with practice partners and gather insights into the potential of collaborative agri-environmental schemes and the so-called “Dutch model” in further studies. Among others, similar studies are planned in the Netherlands, Hungary and Poland. An English-language report describing this process is available for download:

Rommel, J., van Bussel, L., le Clech, S., Czajkowski, M., Höhler, J., Matzdorf, B., … & Zagórska, K. (2021). Environmental cooperation at Landscape Scales: First Insights from Co-Designing Public goods games with Farmers in Four EU Member States. https://pub.epsilon.slu.se/23419/

Title Photo by Warren Wong on Unsplash