Economic Research Report No. (ERR-181) 53 pp

January 2015

Options for Improving Conservation Programs: Insights from Auction Theory and Economic Experiments

USDA spends over $5 billion per year on conservation programs, mostly on voluntary programs that pay farmers and landowners to provide environmental services. This report studies the use of auctions in conservation programs to determine if auction design can reduce Government expenditures or encourage landowners to provide greater environmental services.

Keywords: Conservation Reserve Program, CRP, auctions, enrollment mechanisms, bid caps, reference price auction, quota auction

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