From REDD to Green: A Global Incentive System to Stop Tropical Forest Clearing- Working Paper 282
In this paper, we develop and illustrate a prototype incentive system for promoting rapid reduction of forest clearing in tropical countries. Our proposed Tropical Forest Protection Fund (TFPF) is a cash-on-delivery system that rewards independently monitored performance without formal contracts. The system responds to forest tenure problems in many countries by dividing incentive payments between national governments, which command the greatest number of instruments that affect forest clearing, and indigenous communities, which often have tenure rights in forested lands. The TFPF incorporates both monetary and reputational incentives, which are calculated quarterly. The monetary incentives are unconditional cash transfers based on measured performance, while the reputational incentives are publicly disclosed, color-coded performance ratings for each country. The incentives include rewards for: (1) exceeding long-run expectations, given a country’s forest clearing history and development status; (2) meeting or exceeding global REDD+ goals; and (3) achieving an immediate reduction in forest clearing. Drawing on monthly forest clearing indicators from the new FORMA (Forest Monitoring for Action) database, we illustrate a prototype TFPF for eight East Asian countries: Cambodia, China, Indonesia, Lao PDR, Malaysia, Myanmar, Thailand, and Vietnam. A system with identical design principles could be implemented by single or multiple donors for individual or multiple forest proprietors within one or more countries, as well as national or local governments in individual countries, tropical regions, or the global pan-tropics. Our results demonstrate the importance of financial flexibility in the design of the proposed TFPF. Its incentives are calculated to induce a massive, rapid reduction of tropical forest clearing. If that occurs, a TFPF for East Asia will need standby authority for disbursements that may total $10–14 billion annually for the next two decades. This financial burden will not persist, however, because the TFPF is designed to self-liquidate once all recipient countries have achieved clearly specified benchmarks. We estimate that the TFPF can be closed by 2070, with its major financial responsibility discharged by 2040.
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Pfaff, Alexander S. P., 1999. "What Drives Deforestation in the Brazilian Amazon?: Evidence from Satellite and Socioeconomic Data," Journal of Environmental Economics and Management, Elsevier, vol. 37(1), pages 26-43, January.
- Muhammad Zikri, 2009. "An Econometric Model for Deforestation in Indonesia," Working Papers in Economics and Development Studies (WoPEDS) 200903, Department of Economics, Padjadjaran University, revised Jul 2009.
- Allen Blackman, 2010. "Alternative Pollution Control Policies in Developing Countries," Review of Environmental Economics and Policy, Association of Environmental and Resource Economists, vol. 4(2), pages 234-253, Summer.
- Jean-Louis ARCAND & Patrick GUILLAUMONT & Sylviane GUILLAUMONT JEANNENEY, 2005.
"Deforestation and the Real Exchange Rate,"
- Jean-Louis Arcand & Patrick Guillaumont & Sylviane Guillaumont Jeanneney, 2011. "Deforestation and the Real Exchange Rate," Working Papers halshs-00570477, HAL.
- Jean-Louis Arcand & Sylviane Guillaumont Jeanneney & Patrick Guillaumont, 2008. "Deforestation and the Real Exchange Rate," Post-Print hal-00274384, HAL.
- Jean-Louis ARCAND & Patrick GUILLAUMONT & Sylviane GUILLAUMONT JEANNENEY, 2003. "Deforestation and the Real Exchange Rate," Working Papers 200332, CERDI.
- Danilo Camargo Igliori, 2006.
"Deforestation, Growth And Agglomeration Effects: Evidence From Agriculture In The Brazilian Amazon,"
Anais do XXXIV Encontro Nacional de Economia [Proceedings of the 34th Brazilian Economics Meeting]
102, ANPEC - Associação Nacional dos Centros de Pósgraduação em Economia [Brazilian Association of Graduate Programs in Economics].
- Danilo Igliori, 2008. "Deforestation, Growth and Agglomeration Effects: Evidence from Agriculture in the Brazilian Amazon," Environmental Economy and Policy Research Working Papers 29.2008, University of Cambridge, Department of Land Economics, revised 2008.
- Danilo Igliori, 2006. "Deforestation, Growth and Agglomeration Effects: Evidence From Agriculture in the Brazilian Amazon," ERSA conference papers ersa06p719, European Regional Science Association.
- Maureen Cropper & Charles Griffiths & Muthukumara Mani, 1999. "Roads, Population Pressures, and Deforestation in Thailand, 1976-1989," Land Economics, University of Wisconsin Press, vol. 75(1), pages 58-73.
- Barbier, Edward B., 2000.
"Links between economic liberalization and rural resource degradation in the developing regions,"
Blackwell, vol. 23(3), pages 299-310, September.
- Barbier, Edward B., 2000. "Links between economic liberalization and rural resource degradation in the developing regions," Agricultural Economics of Agricultural Economists, International Association of Agricultural Economists, vol. 23(3), September.
- Blackman, Allen & Afsah, Shakeb & Ratunanda, Damayanti, 2000. "How Do Public Disclosure Pollution Control Programs Work? Evidence from Indonesia," Discussion Papers dp-00-44, Resources For the Future.
- Cropper, Maureen & Griffiths, Charles, 1994. "The Interaction of Population Growth and Environmental Quality," American Economic Review, American Economic Association, vol. 84(2), pages 250-54, May.
- Andrea Cattaneo, 2001. "Deforestation in the Brazilian Amazon: Comparing the Impacts of Macroeconomic Shocks, Land Tenure, and Technological Change," Land Economics, University of Wisconsin Press, vol. 77(2), pages 219-240.
- Maureen Cropper & Jyotsna Puri & Charles Griffiths, 2001. "Predicting the Location of Deforestation: The Role of Roads and Protected Areas in North Thailand," Land Economics, University of Wisconsin Press, vol. 77(2), pages 172-186.
- Kenneth M. Chomitz & Timothy S. Thomas, 2003. "Determinants of Land Use in Amazônia: A Fine-Scale Spatial Analysis," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 85(4), pages 1016-1028.
- Alessandro Pinto & Gerald C. Nelson, 2009. "Land Use Change with Spatially Explicit Data: A Dynamic Approach," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 43(2), pages 209-229, June.
- Vance, Colin & Geoghegan, Jacqueline, 2002.
"Temporal and spatial modelling of tropical deforestation: a survival analysis linking satellite and household survey data,"
Blackwell, vol. 27(3), pages 317-332, November.
- Vance, Colin & Geoghegan, Jacqueline, 2002. "Temporal and spatial modelling of tropical deforestation: a survival analysis linking satellite and household survey data," Agricultural Economics of Agricultural Economists, International Association of Agricultural Economists, vol. 27(3), November.
- Klaus Deininger & Bart Minten, 2002. "Determinants of Deforestation and the Economics of Protection: An Application to Mexico," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 84(4), pages 943-960.
- San, Nu Nu & Löfgren, Hans & Robinson, Sherman, 2000. "Structural adjustment, agriculture, and deforestation in the Sumatera regional economy," TMD discussion papers 52, International Food Policy Research Institute (IFPRI).
When requesting a correction, please mention this item's handle: RePEc:cgd:wpaper:282. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (David Roodman)
If references are entirely missing, you can add them using this form.