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Paying for Biodiversity Conservation Services in Agricultural Landscapes

Author

Listed:
  • Stefano Pagiola

    (World Bank)

  • Paola Agostini

    (World Bank)

  • José Gobbi

    (CATIE)

  • Cees de Haan

    (World Bank)

  • Muhammad Ibrahim

    (CATIE)

Abstract

Adoption of improved silvopastoral practices in degraded pasture areas is thought to provide valuable local and global environmental benefits, including biodiversity conservation, However, these practices are insufficiently attractive to individual land users for them to adopt them spontaneously, particularly due to their high initial costs. This paper describes the contract mechanism developed for the Regional Integrated Silvopastoral Ecosystem Management Project, which is being implemented with financing from the Global Environment Facility (GEF). The project is testing the use of the payment-for-service mechanism to encourage the adoption of silvopastoral practices in three countries of Central and South America: Colombia, Costa Rica, and Nicaragua. The project has created a mechanism that pays land users for the global environmental services they are generating, so that the additional income stream makes the proposed practices privately profitable. Designing the mechanism required addressing issues such as (1) measuring the actual amount of environmental services being provided, so that appropriate payments can be made; (2) providing payments in a way that resulted in the desired change in land use; and (3) avoiding the creation of perverse incentives (for example, for land users to cut down existing trees so as to qualify for additional payments for tree planting). Two variants of the proposed payment mechanism are being tested, with participating land users assigned randomly to one or the other. The project also includes extensive monitoring of the effectiveness of each mechanism in stimulating adoption of the proposed measures and of the resulting impact on environmental services and on household welfare. These features, together with the three-country approach, will provide in the coming years a very rich dataset for testing the use of contract mechanisms for biodiversity conservation.

Suggested Citation

  • Stefano Pagiola & Paola Agostini & José Gobbi & Cees de Haan & Muhammad Ibrahim, 2004. "Paying for Biodiversity Conservation Services in Agricultural Landscapes," Others 0405005, University Library of Munich, Germany.
  • Handle: RePEc:wpa:wuwpot:0405005
    Note: Type of Document - pdf; pages: 48. PDF of working paper
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    Citations

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    Cited by:

    1. Nicolas Kosoy & Miguel Martinez-Tuna & Roldan Muradian & Joan Martinez-Alier, "undated". "Payments for Environmental Services in Watersheds: Insights From a Comparative Study of three Cases in Central America," UHE Working papers 2006_01, Universitat Autònoma de Barcelona, Departament d'Economia i Història Econòmica, Unitat d'Història Econòmica.
    2. repec:eee:ecoser:v:8:y:2014:i:c:p:16-24 is not listed on IDEAS
    3. Barton, D.N. & Rusch, G. & May, P. & Ring, I. & Unnerstall, H. & Santos, R. & Antunes, P. & Brouwer, R. & Grieg-Gran, M. & Similä, J. & Primmer, E. & Romeiro, A. & DeClerck, F. & Ibrahim, M., 2009. "Assessing the role of economic instruments in a policy mix for biodiversity conservation and ecosystem services provision: a review of some methodological challenges," MPRA Paper 15554, University Library of Munich, Germany.
    4. Mekou Bele & Olufunso Somorin & Denis Sonwa & Johnson Nkem & Bruno Locatelli, 2011. "Forests and climate change adaptation policies in Cameroon," Mitigation and Adaptation Strategies for Global Change, Springer, vol. 16(3), pages 369-385, March.
    5. Pagiola, Stefano & Ramirez, Elias & Gobbi, Jose & de Haan, Cees & Ibrahim, Muhammad & Murgueitio, Enrique & Ruiz, Juan Pablo, 2007. "Paying for the environmental services of silvopastoral practices in Nicaragua," Ecological Economics, Elsevier, vol. 64(2), pages 374-385, December.
    6. Bennett, Michael T. & Mehta, Aashish & Xu, Jintao, 2011. "Incomplete property rights, exposure to markets and the provision of environmental services in China," China Economic Review, Elsevier, vol. 22(4), pages 485-498.
    7. Rios, Ana R. & Pagiola, Stefano, 2009. "Poor household participation in payments for environmental services in Nicaragua and Colombia," MPRA Paper 13727, University Library of Munich, Germany.
    8. Luca Di Corato, 2006. "Mechanism Design for Biodiversity Conservation in Developing Countries," "Marco Fanno" Working Papers 0034, Dipartimento di Scienze Economiche "Marco Fanno".
    9. Stefano Pagiola & Ana Rios & Agustin Arcenas, 2010. "Poor Household Participation in Payments for Environmental Services: Lessons from the Silvopastoral Project in Quindío, Colombia," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 47(3), pages 371-394, November.
    10. Legrand, Thomas & Froger, Géraldine & Le Coq, Jean-François, 2013. "Institutional performance of Payments for Environmental Services: An analysis of the Costa Rican Program," Forest Policy and Economics, Elsevier, vol. 37(C), pages 115-123.
    11. Pagiola, Stefano & Rios, Ana R. & Arcenas, Agustin, 2008. "Can the poor participate in payments for environmental services? Lessons from the Silvopastoral Project in Nicaragua," Environment and Development Economics, Cambridge University Press, vol. 13(03), pages 299-325, June.
    12. Gulati, Sumeet & Vercammen, James, 2006. "Time inconsistent resource conservation contracts," Journal of Environmental Economics and Management, Elsevier, vol. 52(1), pages 454-468, July.
    13. Kosoy, Nicolas & Martinez-Tuna, Miguel & Muradian, Roldan & Martinez-Alier, Joan, 2007. "Payments for environmental services in watersheds: Insights from a comparative study of three cases in Central America," Ecological Economics, Elsevier, vol. 61(2-3), pages 446-455, March.
    14. Pagiola, Stefano & Arcenas, Agustin & Platais, Gunars, 2005. "Can Payments for Environmental Services Help Reduce Poverty? An Exploration of the Issues and the Evidence to Date from Latin America," World Development, Elsevier, vol. 33(2), pages 237-253, February.
    15. Perez, Carlos & Roncoli, Carla & Neely, Constance & Steiner, Jean L., 2007. "Can carbon sequestration markets benefit low-income producers in semi-arid Africa? Potentials and challenges," Agricultural Systems, Elsevier, vol. 94(1), pages 2-12, April.
    16. Pagiola, Stefano, 2008. "Payments for environmental services in Costa Rica," Ecological Economics, Elsevier, vol. 65(4), pages 712-724, May.
    17. Dutilly-Diane, Celine & McCarthy, Nancy & Turkelboom, Francis & Bruggeman, Adriana & Tiedemann, James & Street, Kenneth & Serra, Gianluca, 2007. "Could payments for environmental services improve rangeland management in Central Asia, West Asia and North Africa?:," CAPRi working papers 62, International Food Policy Research Institute (IFPRI).
    18. Ludivine Eloy & Philippe Méral & Thomas Ludewigs & Gustavo Tosello Pinheiro & Benjamin Singer, 2012. "Payments for ecosystem services in Amazonia. The challenge of land use heterogeneity in agricultural frontiers near Cruzeiro do Sul (Acre,Brazil)," Journal of Environmental Planning and Management, Taylor & Francis Journals, vol. 55(6), pages 685-703, September.
    19. Labbate, Gabriel, 2008. "The incremental cost principle and the conservation of globally important habitats: A critical examination," Ecological Economics, Elsevier, vol. 65(2), pages 216-224, April.
    20. Farley, Josh & Aquino, André & Daniels, Amy & Moulaert, Azur & Lee, Dan & Krause, Abby, 2010. "Global mechanisms for sustaining and enhancing PES schemes," Ecological Economics, Elsevier, vol. 69(11), pages 2075-2084, September.
    21. Alfaro-Arguello, Rigoberto & Diemont, Stewart A.W. & Ferguson, Bruce G. & Martin, Jay F. & Nahed-Toral, José & David Álvarez-Solís, J. & Ruíz, René Pinto, 2010. "Steps toward sustainable ranching: An emergy evaluation of conventional and holistic management in Chiapas, Mexico," Agricultural Systems, Elsevier, vol. 103(9), pages 639-646, November.
    22. Tschakert, Petra, 2007. "Environmental services and poverty reduction: Options for smallholders in the Sahel," Agricultural Systems, Elsevier, vol. 94(1), pages 75-86, April.

    More about this item

    Keywords

    Payments for Environmental Services; Contract design; Biodiversity; Conservation; Silvopastoral; Agroforestry;

    JEL classification:

    • P - Economic Systems
    • Q - Agricultural and Natural Resource Economics; Environmental and Ecological Economics
    • Z - Other Special Topics

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