Scaling up pro-environmental agricultural practice using agglomeration payments: Proof of concept from an agent-based model

Rates of adoption of pro-environmental practices in agriculture in many parts of the world are low. In some cases, this is attributable to the private costs borne by farmers to adopt these practices, often well in advance of any benefits - public or private - that they may bring. Monetary incentives, such as through payments-for-ecosystem services (PES) programs, may be of assistance, and in this study we examine the potential for a recent innovation (the agglomeration payment) to improve adoption of pro-environmental practice in a rural agricultural context. Agglomeration payments include bonus payments for adoption by neighboring farms, which may help to encourage both compliance with the program they promote as well as the overall diffusion of the program across rural contexts. We develop an abstract agent-based model (ABM) of an agglomeration payment program to encourage adoption of the pro-environment practice of conservation agriculture (CA). We find that agglomeration payments have the potential to improve levels of adoption of pro-environmental practice per program dollar, and may help to reduce required spending on project monitoring and enforcement.