Not all group incentives are created equally

Abstract

The growing interest in payment-based incentives as a policy tool requires robust evidence regarding the effectiveness of alternative payment structures in eliciting pro-conservation behavior. How incentives are structured not only determines how much individual resource users can be influenced, but also impacts wider co-benefits, such as building the capacity of local institutions or changing social norms. Gatiso et al. (2017) contribute to this evidence base with their experimental study of individual- and group-based payments to promote sustainable community forestry. Two important points arise from their study: i) how group and individual incentives are defined and ii) the need for fair comparisons between incentives in experimental studies. The authors find that individual payments performed better in their experiment and note that previous studies (Salk et al., 2017; Travers et al., 2011) draw the opposite conclusion, attributing this to cultural, political and experimental factors. While these are certainly relevant, there are more fundamental explanations, notably how these studies define individual and group incentives and the relative payout gained from free-riding.