Quality Information and Procurement Auction Outcomes: Evidence from a Payment for Ecosystem Services Laboratory Experiment

Procuring agencies in conservation auctions typically have more information about the ecosystem service (ES) quality of conservation actions than landowners and can affect auction outcomes by controlling participants' access to this information. Our induced-value laboratory auction experiment explores the impact of sellers' access to ES-quality information on auction efficiency when the conservation action choice is endogenous to offer formation. We find that providing ES-quality information allows sellers to identify and submit higher-quality conservation actions, an effect that counteracts previously identified efficiency losses from information rents.