The Nature Conservancy rented flooded rice fields for migrating birds by reverse auction

The Pacific Flyway, one of the world's major bird migration routes, has lost over 90% of its original wetland habitat in California as wetlands became farms — and droughts keep making it worse for the millions of birds that pass through.

The traditional conservation answer, purchasing and restoring land, is very expensive. Eric Hallstein, an economist at The Nature Conservancy, had another idea: pay rice farmers to flood their fields for the season.

The program runs as a reverse auction — farmers calculate what flooding would cost them and bid for the payment. Since it started in 2014 the program has delivered habitat at a fraction of the cost of buying land, and even in the especially bad drought year of 2021, farmers came through with reverse bids.

Farmers know their own costs better than any appraiser, so the auction reveals the true market price of a flooded field.

Bidding against each other pushes payments down toward actual cost instead of toward land-value prices.

Rice fields already sit on historic wetland ground along the flyway, so a season of water recreates the missing habitat in place.

When the asset you need is seasonal, auction a rental instead of buying the property: self-interested bids price the habitat cheaper than any appraisal.

The program has run since 2014 with what NPR's The Indicator called huge success at a fraction of the cost of land purchase, and it held up in the 2021 drought, one of the worst on record, when habitat was scarcest and farmers still opted in.