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Payment for Environmental Services (PES) schemes have been promoted as a means of harnessing the power of markets to secure environmental protection, but worldwide experience in achieving this goal has been poor. An attempt to design and implement a PES scheme that addresses this deficiency by mimicking a market for biodiversity protection in Lao PDR will be detailed in this seminar. Choice modelling was used to estimate the demand for biodiversity protection held by tourists to Lao PDR and the local residents of urban Vientiane. Reverse auctions were used to estimate the marginal costs of local villagers who agreed to engage in anti-poaching patrols in two protected areas. Simulation models were developed to link quantitatively the patrol effort with the biodiversity protection outcomes so produced. The meshing of these three elements enabled the setting of a ‘market clearing price’ that ensures the generation of consumer and producer surpluses.