Thursday, February 22
Fri
Nov
24

Bidder-optimal auction design for ecosystem restoration when sellers face exogenous risk

Speakers:

Dr. Chandan SinghaHindu College, University of Delhi

 
24
November,
2023
11:30 AM to 01:00 PM (IST)

Abstract:-

The success of tree plantation contracts for carbon sequestration depends on the compliance of the winners of the contracts. We introduce a penalty and bonus incentive (contingent payment) in a tree plantation contract to address the problem of non-compliance in the context of tree plantation contracts allocated by a sealed-bid reverse auction. We evaluate both theoretically and empirically the contingent payment’s impact on farmland owners’ willingness to accept (WTA) compensation to use their land for tree plantations instead of crop cultivation. Empirically, we use a framed field experiment in the Bundelkhand region of India. We design a reverse auction to decide the winning bid. Our findings indicate that the average bid in the contingent contract treatment is significantly higher than in the non-contingent contract treatment. Furthermore, bidders in the contingent contract treatment attach greater importance to avoiding penalties than gaining bonuses. A contract incorporating contingent payments offers the potential for higher tree survival rates and increased carbon storage at a lower overall cost compared to a contract without contingent payments.

To register for this event please visit the following URL: https://us06web.zoom.us/meeting/register/tZwsd--qpzkrHNNPB4jA4cWOSbN4j77oHroA →

Date & Time

24-11-2023
11:30 AM
to 01:00 PM (IST)

Location

IEG

Venue

A.M. Khusro room

Event Type

IEG Seminar

Event Category

Past event

Speaker(s)

Dr. Chandan Singha

Hindu College, University of Delhi

Moderator(s)

Sandhya Garg

Assistant Professor