The impact of terminated Payments for Ecosystem Services (IMPACTED)

Reducing deforestation is one of the most cost-effective climate change mitigation options. Payments for Ecosystem Services (PES) are now increasingly implemented in developing countries as conservation policy tools providing conditional incentives for conservation efforts. So-called asset-building PES are based on the assumption that environmental-friendly practices are not adopted by land-users due to high initial adoption costs. PES provide incentives for a limited time period to overcome this barrier. After a successful adoption of environmental-friendly practices it is assumed that land-users will stick to them after incentives have been removed. The proposed project will evaluate several long-term aspects of a terminated asset-building PES project in Mozambique: the Sofala community carbon project (SCCP). Between 2003 and 2013 more than 2500 smallholders were contracted to adopt various agro-forestry measures in return for cash payments. In particular, our project will build on a quasi-experimental design to evaluate the impacts of the SCCP with regard to two major criticisms concerning PES:

• Environmental effectiveness with respect to deforestation and carbon sequestration.
• Crowding-out of intrinsic pro-environmental values and social norms of smallholder farmers as well as communities’ capacities for collective action for the sustainable use of natural resources.

Our project includes three specific work packages. WP1 evaluates the impact of the SCCP on land-use and land-cover changes with respect to deforestation, slash-and-burn agriculture and agroforestry at the landscape level by applying remote sensing-based methods. WP2 will study and estimate below- and above-ground biomass and carbon stocks of different land-use systems in the project region, which allows us to estimate the overall impact of the SCCP on carbon stocks and sequestration. Our study thus provides one of the first long term impact assessments of an asset-building PES using both data from the air and the ground. WP3 will apply a mixed methods approach including surveys, economic experiments and participatory workshops for analysing the impact of the terminated PES on intrinsic pro-environmental conservation values, self-determination, locus-of-control, collective action and social norms at the community level. If PES crowd-out morality, introducing PES schemes may have negative consequences in other spheres of life as well. This might be especially harmful in small rural communities where pro-social behaviour is instrumental for many other non-market exchanges. Our project delivers a unique and encompassing perspective on the effects of monetary incentives on environmental conservation, human behaviour and its underlying motives in the context of a large-scale terminated PES program, which contributes to further developing a context-specific motivation crowding theory.