The Bobolink Project: Selling Public Goods From Ecosystem Services Using Provision Point Mechanisms

Abstract

We report a two-year field experiment that solicited residents of Jamestown, Rhode Island, USA, to fund contracts with farmers willing to provide public goods associated with improving the nesting success of grassland birds, particularly the Bobolink. This experiment explores the potential to leverage valuation research for the purpose of enhancing charitable contributions in a manner consistent with developing markets for ecosystem-service public goods; we focus on individuals' willingness to contribute revenue. The direct-mail marketing experiment collected over $16,000 through four provision point, money-back guarantee mechanisms: a voluntary contribution mechanism with a proportional rebate; a pivotal mechanism based on the Clarke tax; and two novel uniform price mechanisms, each presented in discrete choice and open-ended response formats. We find that citizens do respond strategically: consistently lower offers in the open-ended format suggest a high incidence of cheap riding, but also a significant effect of higher suggested offer thresholds. These framing effects dominated differences among mechanisms, as revenue generated from the proportional rebate and one of the uniform price mechanisms approached the potential for revenue generation estimated under the incentive compatible pivotal mechanism.