Agricultural landscape certification as a market-driven tool to reward the provisioning of cultural ecosystem services

Traditional agricultural landscapes provide cultural ecosystem services to human communities. However, the limited profitability of these landscapes often discourages farmers from preserving them. The current research evaluates: (i) whether the market would reward farmers providing a cultural ecosystem service, through an increased willingness to pay (WTP), for a food product with a traditional agricultural landscape certification; and (ii) what happens to the WTP when a food product reports multiple certifications, including the traditional agricultural landscape one. A convenience sample of Italian extra-virgin olive oil (EVOO) buyers was involved in a non-hypothetical random nth price auction to determine the WTP for 250 ml EVOO bottles carrying different certification bundles. These bundles were composed of different combinations of three certifications: Organic, Protected Designation of Origin, and a traditional agricultural landscape certification associated with the preservation of terraced olive groves. The findings indicate that the traditional agricultural landscape certification receives a premium price both when EVOO carries it individually or combined with other labels. In the latter case, results show sub-additivity of premium prices. The current research proves that traditional agricultural landscapes are not necessarily bound to market failure; however, costs faced by farmers to maintain them can be rewarded through the market.