Public investment does not crowd out private supply of environmental goods on private land

Abstract

In landscapes where private land tenure is prevalent, public funds for ecological landscape restoration are sometimes spent subsidising the revegetation of cleared land, and the protection of remnant vegetation from livestock. However, the total area treated may be unclear because such projects are not always recorded, and landholders may undertake similar activities without subsidisation. In the absence of empirical data, in the state of Victoria, Australia, a reporting assumption has been employed that suggests that wholly privately funded sites match publicly subsidised sites on a hectare for hectare basis (a so-called "x2" assumption). Conversely, the "crowding out" theory of investment ..