Simple and Approximately Optimal Contracts for Payment for Ecosystem Services

Published Online:https://doi.org/10.1287/mnsc.2021.4273

References

  • Alix-Garcia J, Wolff H (2014) Payment for ecosystem services from forests. Annual Rev. Resource Econom. 6(1):361–380.CrossrefGoogle Scholar
  • Atasu A, Corbett CJ, Huang X, Toktay LB (2020) Sustainable operations management through the perspective of Manufacturing & Service Operations Management. Manufacturing Service Oper. Management 22(1):146–157.LinkGoogle Scholar
  • Bolandifar E, Feng T, Zhang F (2018) Simple contracts to assure supply under noncontractible capacity and asymmetric cost information. Manufacturing Service Oper. Management 20(2):217–231.LinkGoogle Scholar
  • Borner J, Baylis K, Corbera E, Ezzine-de Blas D, Honey-Roses J, Persson UM, Wunder S (2017) The effectiveness of payments for environmental services. World Development 96:359–374.CrossrefGoogle Scholar
  • Butler RA (2019) Tropical forests’ lost decade: The 2010s. Accessed September 30, 2020, https://news.mongabay.com/2019/12/tropical-forests-lost-decade-the-2010s/.Google Scholar
  • Carroll G (2015) Robustness and linear contracts. Amer. Econom. Rev. 105(2):536–563.CrossrefGoogle Scholar
  • Chemnick J (2021) Cost of carbon pollution pegged at $51 a ton. Sci. Amer. (March 1), https://www.scientificamerican.com/article/cost-of-carbon-pollution-pegged-at-51-a-ton/.Google Scholar
  • Corbett CJ, Zhou D, Tang CS (2004) Designing supply contracts: Contract type and information asymmetry. Management Sci. 50(4):550–559.LinkGoogle Scholar
  • Dasgupta P, Hammond P, Maskin E (1979) The implementation of social choice rules: Some general results on incentive compatibility. Rev. Econom. Stud. 46(2):185–216.CrossrefGoogle Scholar
  • de Zegher JF, Iancu DA, Lee HL (2019) Designing contracts and sourcing channels to create shared value. Manufacturing Service Oper. Management 21(2):271–289.LinkGoogle Scholar
  • DüttingP, Roughgarden T, Talgam-Cohen I (2019) Simple vs. optimal contracts. Proc. 2019 ACM Conf. Econom. Comput. (Association for Computing Machinery, New York), 369–387.Google Scholar
  • Engel S (2016) The devil in the detail: A practical guide on designing payments for environmental services. Internat. Rev. Environ. Resource Econom. 9(1–2):131–177.CrossrefGoogle Scholar
  • Engel S, Pagiola S, Wunder S (2008) Designing payments for environmental services in theory and practice: An overview of the issues. Ecological Econom. 65(4):663–674.CrossrefGoogle Scholar
  • Ferraro PJ (2008) Asymmetric information and contract design for payments for environmental services. Ecological Econom. 65(4):810–821.CrossrefGoogle Scholar
  • Hansen MC, Potapov PV, Moore R, Hancher M, Turubanova SA, Tyukavina A, Thau D, et al. (2013) High-resolution global maps of 21st-century forest cover change. Science 342(6160):850–853.CrossrefGoogle Scholar
  • Harstad B, Mideksa TK (2017) Conservation contracts and political regimes. Rev. Econom. Stud. 84(4):1708–1734.Google Scholar
  • Hawken P (2017) Drawdown: The Most Comprehensive Plan Ever Proposed to Reverse Global Warming (Penguin, New York).Google Scholar
  • Jack BK, Jayachandran S (2019) Self-selection into payments for ecosystem services programs. Proc. Natl. Acad. Sci. USA 116(12):5326–5333.CrossrefGoogle Scholar
  • Jayachandran S (2013) Liquidity constraints and deforestation: The limitations of payments for ecosystem services. Amer. Econom. Rev. 103(3):309–313.CrossrefGoogle Scholar
  • Jayachandran S, De Laat J, Lambin EF, Stanton CY, Audy R, Thomas NE (2017) Cash for carbon: A randomized trial of payments for ecosystem services to reduce deforestation. Science 357(6348):267–273.CrossrefGoogle Scholar
  • Jean N, Wang S, Samar A, Azzari G, Lobell D, Ermon S (2019) Tile2vec: Unsupervised representation learning for spatially distributed data. Proc. 33rd AAAI Conf. Artificial Intelligence (AAAI Press, Palo Alto, CA), 3967–3974.Google Scholar
  • Kim SH (2015) Time to come clean? Disclosure and inspection policies for green production. Oper. Res. 63(1):1–20.LinkGoogle Scholar
  • Kim SH, Netessine S (2013) Collaborative cost reduction and component procurement under information asymmetry. Management Sci. 59(1):189–206.LinkGoogle Scholar
  • Laffont JJ, Tirole J (1986) Using cost observation to regulate firms. J. Political Econom. 94(3, Part 1):614–641.CrossrefGoogle Scholar
  • Lansing DM (2017) Understanding smallholder participation in payments for ecosystem services: The case of Costa Rica. Human Ecology 45(1):77–87.CrossrefGoogle Scholar
  • Lee HL, Tang CS (2018) Socially and environmentally responsible value chain innovations: New operations management research opportunities. Management Sci. 64(3):983–996.LinkGoogle Scholar
  • Lubowski RN, Plantinga AJ, Stavins RN (2006) Land-use change and carbon sinks: Econometric estimation of the carbon sequestration supply function. J. Environ. Econom. Management 51(2):135–152.CrossrefGoogle Scholar
  • Lütjens B, Liebenwein L, Kramer K (2019) Machine learning-based estimation of forest carbon stocks to increase transparency of forest preservation efforts. Proc. NeurIPS Workshop Tackling Climate Change AI. https://www.climatechange.ai/events/neurips2019#about-the-workshop.Google Scholar
  • Mason CF, Plantinga AJ (2013) The additionality problem with offsets: Optimal contracts for carbon sequestration in forests. J. Environ. Econom. Management 66(1):1–14.CrossrefGoogle Scholar
  • Mirrlees JA (1971) An exploration in the theory of optimum income taxation. Rev. Econom. Stud. 38(2):175–208.CrossrefGoogle Scholar
  • Muñoz-Piña C, Guevara A, Torres JM, Braña J (2008) Paying for the hydrological services of Mexico’s forests: Analysis, negotiations and results. Ecological Econom. 65(4):725–736.CrossrefGoogle Scholar
  • Mussa M, Rosen S (1978) Monopoly and product quality. J. Econom. Theory 18(2):301–317.CrossrefGoogle Scholar
  • Myerson RB (1979) Incentive compatibility and the bargaining problem. Econometrica 47(1):61–73.CrossrefGoogle Scholar
  • Orsdemir A, Hu B, Deshpande V (2019) Ensuring corporate social and environmental responsibility through vertical integration and horizontal sourcing. Manufacturing Service Oper. Management 21(2):417–434.LinkGoogle Scholar
  • Pattanayak SK, Wunder S, Ferraro PJ (2010) Show me the money: Do payments supply environmental services in developing countries? Rev. Environ. Econom. Policy 4(2):254–274.CrossrefGoogle Scholar
  • Perakis G, Roels G (2007) The price of anarchy in supply chains: Quantifying the efficiency of price-only contracts. Management Sci. 53(8):1249–1268.LinkGoogle Scholar
  • Peterson JM, Smith CM, Leatherman JC, Hendricks NP, Fox JA (2015) Transaction costs in payment for environmental service contracts. Amer. J. Agricultural Econom. 97(1):219–238.CrossrefGoogle Scholar
  • Plambeck EL, Taylor TA (2016) Supplier evasion of a buyer’s audit: Implications for motivating supplier social and environmental responsibility. Manufacturing Service Oper. Management 18(2):184–197.LinkGoogle Scholar
  • Porras I, Barton DN, Miranda M, Chacón-Cascante A (2017) Learning from 20 Years of Payments for Ecosystem Services in Costa Rica (International Institute for Environment and Development, London).Google Scholar
  • Salzman J, Bennett G, Carroll N, Goldstein A, Jenkins M (2018) The global status and trends of payments for ecosystem services. Nature Sustainability 1(3):136–144.CrossrefGoogle Scholar
  • Stern NH, Peters S, Bakhshi V, Bowen A, Cameron C, Catovsky S, Crane D, et al. (2006) The Economics of Climate Change: The Stern Review (Cambridge University Press, Cambridge, UK).Google Scholar
  • Strassburg BB, Iribarrem A, Beyer HL, Cordeiro CL, Crouzeilles R, Jakovac CC, Junqueira AB, et al. (2020) Global priority areas for ecosystem restoration. Nature 586(7831):724–729.CrossrefGoogle Scholar
  • Teytelboym A (2019) Natural capital market design. Oxford Rev. Econom. Policy 35(1):138–161.CrossrefGoogle Scholar
  • Wang S, Sun P, de Véricourt F (2016) Inducing environmental disclosures: A dynamic mechanism design approach. Oper. Res. 64(2):371–389.LinkGoogle Scholar
  • Wunder S, Albán M (2008) Decentralized payments for environmental services: The cases of Pimampiro and PROFAFOR in Ecuador. Ecological Econom. 65(4):685–698.CrossrefGoogle Scholar
  • Yu Y, Kong X (2020) Robust contract designs: Linear contracts and moral hazard. Oper. Res. 68(5):1457–1473.LinkGoogle Scholar
INFORMS site uses cookies to store information on your computer. Some are essential to make our site work; Others help us improve the user experience. By using this site, you consent to the placement of these cookies. Please read our Privacy Statement to learn more.