Research on the Game Mechanism of Cultivated Land Ecological Compensation Standards Determination: Based on the Empirical Analysis of the Yangtze River Economic Belt, China

Abstract

The ecological compensation of cultivated land could also be called paying for the ecological service of cultivated land. It means that based on comprehensive consideration of the cost of the protection of the cultivated land and the value of the ecological service, the benefited area would implement the ecological compensation to the damaged area to motivate the actors of the protection behavior to protect the cultivated land better. A fair and reasonable cultivated land ecological compensation mechanism is critical in motivating cultivated land protection subjects’ active participation in cultivated land protection. However, most of the currently measured cultivated land ecological compensation standards are only determined from the perspective of a single interest, ignoring the participation and negotiation of cultivated land protection stakeholders, resulting in insufficient pertinence, low compensation standards, and low compensation efficiency. Therefore, by introducing a market mechanism, this study constructs a non-cooperative bargaining model and solves three stages of the game equilibrium solution under the condition of comprehensive consideration of interests of farmland ecosystem service providers and consumers. In this study, the Yangtze River Economic Belt is taken as the research area to provide empirical analysis of a cultivated land ecological game compensation standard between the subject and object of cultivated land ecological compensation in the area. The study found that, under the ecological compensation standard for cultivated land determined by the bargaining game, the cultivated land ecological compensation subject and object in the area meets the “KaldorHicks” resource allocation criterion, and the standard can take into account the interests of both parties. Meanwhile, the river basin horizontal ecological compensation quota determined by the game standard will neither cause a financial dilemma in the payment area due to the excessive compensation quota, nor financial “windfall gain” in the compensated area due to ecological finance transfer of cultivated land. The cultivated land ecological compensation standard based on the game between the two parties is reasonable and accurate for the cultivated land ecological compensation object, which not only functions as an economic incentive, but maintains long-term effectiveness of policy. Therefore, it is necessary to actively promote the determination of ecological compensation standards based on negotiation means, and to establish a sustainable ecological protection compensation mechanism involving government predomination, social engagement, and market-oriented operations, to drive marketization of cultivated land ecological compensation.