Farmers' preferences for the design of an agglomeration bonus in the context of peatland restoration

This paper investigates how the design of an agglomeration bonus influences farmers’ participation in a stylised peatland restoration scheme. Results from a discrete choice experiment with 110 farmers in Germany indicate that the bonus has only limited influence compared to land-use restrictions. In the mixed logit and latent class estimations the bonus is statistically insignificant and mostly ignored in the decision-making process. Only when preferences are adjusted for attribute non-attendance does the bonus enhance willingness to participate and the scheme’s cost-effectiveness. Overall, voluntary schemes appear insufficient for ambitious peatland restoration goals, suggesting a need to complement incentives with regulatory measures.