NGOs and participatory conservation in developing countries: why are there inefficiencies?

Countries, under the label of participatory conservation. This implies the direct involvement of the local communities in conservation. We develop an economic model to explain why participatory conservation has been “invented”, why in many situations it does not function, and why environmental NGOs find it difficult to make it functioning. The occurrence of the tragedy of the commons in a given natural area may justify an NGO intervention. Since there is empirical evidence of failure of a top-down approach in conservation, the effort of the local stakeholders is necessary. Given that there is contract incompleteness, the NGO may apply participatory conservation. However, since local farmers live at subsistence level and are strongly risk averse, they may give priority to Agricultural income with respect to tourism income, which derives from conservation. They may not collaborate with the NGO for conservation activities if the NGO does not allocate some effort to sustain agriculture. However the NGO is funded by donors with environmental motivations.