Impact of water PES on income distribution in Mexico
Term: October 2009-September 2010
Participating institutions: LTC.
Summary: A key challenge for PES is designing equitable payment distribution among local residents. A case study from Mexico's water payment program will reveal how payments affect the amount and distribution of forest-based income. The activity will foster understanding on how cash transfer schemes, conditional on sustainable environmental management, affect household and community level behaviors, and how these behaviors affect environmental outcomes.
- LTC Brief 11: "Impact of Payments for Ecosystem Services on Deforestation in Mexico: Preliminary Lessons for REDD," by Jennifer M. Alix-Garcia, University of Wisconsin-Madison, Elizabeth N. Shapiro, Duke University, and Katharine R.E. Sims, Amherst College.
The brief summarizes an evaluation of the environmental effectiveness of Mexico's national Payments for Hydrological Services program, which compensates rural landowners for avoided deforestation. The evaluation found that in an early year of implementation Mexico's program had a small to moderate but significant effect in reducing deforestation, indicating that financial compensation policies can be effective in preventing environmental degradation. The research also suggests that some slippage of deforestation may have occurred, implying that avoided deforestation is best accounted for at a regional or national levels. (NOTE: this will be translated to Spanish for use in the region.)
- PowerPoint: "The Impact of Payments for Ecosystem Services on Deforestation in Mexico: Preliminary Lessons for REDD." (Available upon request.)
- "Knowledge Gap: Spillover effects in incentive-based conservation policies."
- Full paper: Forest Conservation and Slippage: Evidence from Mexico's National Payments for Ecosystem Services Program," by Jennifer M. Alix-Garcia, Elizabeth N. Shapiro, and Katharine R.E. Sims. Staff Paper No. 548. Agricultural and Applied Economics, University of Wisconsin-Madison.