EU Science Hub

Conservation when landowners have bargaining power: Continuous conservation investments and cost uncertainty

Spatially heterogeneous costs of securing conservation agreements should be accounted for when prioritizing properties for conservation investment. Most studies of conservation costs rely on estimates of landowners’ opportunity costs of accepting a conservation agreement. These studies therefore implicitly assume that those who “produce” biodiversity landowners) receive none of the surplus available from trade. Instead, landowners could exploit symmetric information regarding their private costs of providing conservation benefits to extract some surplus. We employ game theory to deter mine the maximum surplus landowners could obtain in negotiations over conservation agreements when enrolment decisions are governed by continuous variables (e.g., the proportion of a property to enrol). Landowners’ ability to gain surplus is highly variable and reflects variations in the substitutability of different properties for achieving a specified conservation objective.