How can we evaluate conservation auctions? Three Possible methods

By design, tenders are used when costs are unknown. But if costs are unknown, how can we evaluate the tenders, when their evaluation involves measuring their cost-effectiveness? We identify three approaches: theoretical, empirical and experimental. We first use experimental data to compare the efficiency of each approach, then apply the most efficient one to field data from the Scottish fishing vessel decommissioning program. We estimate the potential errors one would make in using a less efficient approach. In this case, we demonstrate a novel use of controlled lab experiments for interpreting field data and evaluating policy effectiveness.