How local forest conservation efforts are incentivized?

Decentralization reforms assume that citizen pressures on politicians will encourage conservation, while PES approaches assume that an economic incentive—money—is the best approach.  Which type of incentive works best in settings with weak institutions?

  Here, using a unique longitudinal dataset of forest policy in 100 Bolivian municipalities, we examine the relationships between citizen pressures and economic incentives on forest policy.  We find that both types of incentives are positively and significantly associated with government investments in forest conservation, and that the magnitudes of these relationships are similar.  Further, we find that economic incentives may be especially effective at promoting conservation where citizen pressures are weak or absent.

In recent years, many scholars and policy makers have accepted the idea that forest conservation is part of a successful climate change strategy (UN-REDD Programme 20102011United Nations Food and Agriculture Organization et al. 2008). However, how best to effectively promote forest conservation is poorly understood (Andersson et al. 2014). At least two policy approaches have been tried in the last decades.

The first of these is the decentralization approach. Starting in the 1970s, many governments around the world began to decentralize authority for natural resource management to regional, local, and/or community governments (Andersson and Van Laerhoven 2007Ribot et al. 2008Kauneckis and Andersson 2009). One common justification was that local and regional governments are more accountable to voters than national governments (Guerrero Figueroa 20022003World Resources Institute 2005aRibot 2008). In the last two decade or so, however, it has become clear that most of these decentralization reforms have had mixed results (Gibson and Lehoucq 2003Andersson and Van Laerhoven 2007). Even so, decentralization, and the promotion of conservation through democratic accountability remains an important part of many pro-conservation policies.

Recently, the PES (payments for ecosystem services) approach – the second of these policy approaches – has begun to garner substantial attention. The promise behind PES schemes is that people who control some ecosystem are paid to conserve that ecosystem, ostensibly in return for the services provided by the ecosystem. For example, owners of forested lands might be paid in return for the carbon sequestration their forests provide. By paying for ecosystem services, the theory goes, PES schemes incentivize the conservation of resources providing those services.

Since the 2009 Copenhagen summit’s failure to reach an agreement on a successor treaty to the Kyoto Protocol, we are left without a comprehensive global agreement on carbon emissions and climate change. Instead, the only tangible global program working to address climate change is a PES program called REDD (Reducing Emissions from Deforestation and Forest Degradation). As the program develops, it is becoming clear that payments to local governments – economic incentives – are likely to play an important role in future REDD activities (United Nations Food and Agriculture Organization et al. 2008Angelsen et al. 2009Ha and Thuy 2009Cerbu et al. 2011). As such, it is important to know whether such economic incentives effectively motivate governments to invest in forest conservation.

Here, we test the relative efficacy of these two types of conservation incentives – democratic pressures and economic benefits. Using a unique longitudinal dataset on forestry policy and politics in 100 Bolivian municipalities, we examine the effects of democratic pressures and economic incentives on forest policy. Bolivia is an excellent setting in which to examine the causes of effective local natural resource governance, because Bolivia is a country that has, over the last 20 years, devolved real authority to local governments for forest governance. In addition, Bolivia is a good place to examine the effects of economic incentives on investments in municipal forest conservation because Bolivian municipal governments often generate income from local forestry sources and receive transfers from national governments to provide forestry services.

We have structured this paper in the following way: We begin by reviewing existing research on the causes of effective local forest governance. Second, we present an argument about the conditions under which local politicians will decide to invest in forest governance. We then turn to our empirical case and present a summary of the formal-legal situation in Bolivian forestry governance. After outlining our data and methods, we present our statistical findings and discuss our results in three short sections outlining the results of three sets of tests. We find that both democratic pressures and economic benefits are associated with more energetic forest conservation policy, and our findings also suggest that economic incentives most strongly motivate conservation where democratic pressures are absent. We conclude with a discussion about the policy implications of these results and topics for future research.

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