| Sumario: | A striking variety of policy instruments are used in Victoria, Australia to achieve conservation objectives. These include highly active voluntary programmes, a variety of conservation grants, and a reverse auction for the provision of ecosystem services, known as EcoTender. An open question regarding such payments for ecosystem services (i.e. grants and tenders) is whether they achieve ‘additionality.’ That is, do they lead to conservation above the status quo? Critics of these instruments allege that the majority of funds for such programmes are merely paying individuals for conservation work they are already doing. A related concern is that monetary incentives for conservation may skew landowners’ motives more towards monetary concerns, and erode nature conservation values. The practical implication of this ‘moral crowding out’ is that, if funding is ever suspended for conservation grants or EcoTenders, then conservation may decline below its original, pre-programme level. To investigate both of these concerns, a telephone survey was conducted with 266 farmers in Victoria. Analysis of the data suggests that there is a strong correlation between stated levels of own-property conservation effort and activity in local volunteer groups, as well as having received a conservation grant or tender. However, this does not address the additionality question, because landowners already engaged in such efforts may be more likely to be awarded grants or tenders. This presents an endogeneity problem. While panel data are ultimately necessary to answer this question definitively, application of instrumental variables methods provides some insight. The methods imply that grants and tenders may achieve ‘additionality’ only when they reach those otherwise uninvolved with conservation programmes, in particular those not volunteering. This suggests that conservation tenders can improve their cost-effectiveness by increasing participation among those not already volunteering in other conservation programmes. Meanwhile, there is fairly strong evidence in the data for the potential for moral-crowding-out; tender or grant receipt appears to shift stated motivations towards more monetary concerns. However, the practical implications of this finding – that is, whether this erosion of attitudes translates in blunted conservation efforts – remain unknown.
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