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The optimal design of farm policy and public investment in agriculture in the presence of asymmetric information between the government and farmers is studied. It is shown that a mix of capped deficiency payments and voluntary paid land diversion can implement the optimal policy outcome. Optimal...
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From a theoretical point of view, result-based agri-environmental payments are clearly preferable to action-based payments. However, they suffer from two major practical disadvantages: costs of measuring the results and payment uncertainty for the participating farmers. In this paper, we propose...
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Incentives based on esteem, honor and shame are increasingly popular and easy to use due to modern surveillance … Tirole (2011) to explore the effect of esteem-based incentives and their interaction with traditional monetary incentives. We … show that esteem-based incentives can indeed lead to a loss of control by generating multiple equilibria, some of which …
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