Presenter
Mrs. Yeqing Duan, Water Resources Economics Research Institute, Business School, Hohai University
Co-author(s)
Prof. Shenbei Zhou, Water Resources Economics Research Institute, Business School, Hohai University
Prof. Martin Drechsler, Helmholtz Centre for Environmental Research - UFZ
Sub-theme
4. Supporting Aquatic Ecosystem Health and Functions
Topic
4-3. Protection and management of major rivers and lakes, from headwaters to estuaries
Body
The wetland offset market is increasingly used worldwide as a powerful tool to resolve the conflict between development and wetland restoration. However, few studies have lent understanding to how to initiate an effective wetland offset market, which is also a great challenge faced by many developing countries like China. The purpose of this article is to explore the role of public offset credit supply (POCS), both in scale and price, in initializing the wetland offset market under regional development-restoration conflicts. Taking the Yellow River Delta as the case study area, this study builds a spatial agent-based wetland development and restoration model, which is used to simulate land use decisions and offset credit trading behavior of landowners. Based on the emerged offset credit price, offset credit market scale, and systematic economic and ecological outcomes, this study investigates the role of public offset credit in promoting the wetland offset market and coordinating development-restoration conflicts. The research results show that the POCS price provides vital price signals in initializing the wetland restoration market, and acts as the price anchor in the market. The POCS scale mainly plays a role in regulating the offset credit supply-demand structure in the market. Under certain price signal conditions, the low public offset credit supply scale can effectively stimulate restoration behavior and private offset credit supply, thereby promoting the growth of the wetland offset market. The proper combination of POCS price and scale can achieve a relatively balanced development-restoration relationship during the growing process of the wetland offset market. The research results show that public offset credit supply is an important tool to initialize the wetland offset market, stabilize the supply-demand relationship of offset credit, and reconcile regional development-restoration conflicts. The research results can provide insights for the establishment of wetland offset markets in developing countries facing development and wetland protection conflicts.