Jennifer Alix-Garcia

The role of deforestation risk and calibrated compensation in designing payments for environmental services

This paper discusses the gain in efficiency from including deforestation risk as a targeting criterion in payments for environmental services (PES) programs. We contrast two payment schemes that we simulate using data from Mexican common property forests: a flat payment scheme with a cap on allowable hectares per enrollee, similar to the program implemented in many countries, and a payment that takes deforestation risk and heterogeneity in land productivity into account. We simulate the latter strategy both with and without a budget constraint. Using observed past deforestation, we find that while risk-targeted payments are far more efficient, capped flat payments are more egalitarian. We also consider the characteristics of communities receiving payments from both programs. We find that the risk-weighted scheme results in more payments to poor communities, and that these payments are more efficient than those made to non-poor ejidos. Finally, we show that the risk of deforestation can be predicted quite precisely with indicators that are easily observable and that cannot be manipulated by the community.

The Effect of Refugee Inflows on Host Communities: Evidence from Tanzania

Despite the large and growing number of humanitarian emergencies, there is little economic research on the impact of refugees and internally displaced people on the communities that receive them. This analysis of the impact of the refugee inflows from Burundi and Rwanda in 1993 and 1994 on host populations in western Tanzania shows large increases in the prices of nonaid food items and more modest price effects for aid-related food items. Food aid is shown to mitigate these effects, though its impact is smaller than that of the increases in the refugee population. Examination of household assets suggests positive wealth effects of refugee camps on nearby rural households and negative wealth effects on households in urban areas.

Lessons learned from Mexico's payment for environmental services program.

This chapter outlines the evolution of Mexico’s payments for hydrological services program from its inception through the first two years of the program’s implementation. Background information on forests, deforestation, and potential environmental services provide context for a political economy analysis of the path the program traveled through Mexico’s legislative and administrative structures. We also analyze the characteristics of the recipients during the first two years, including results from a survey of participants and community case studies. A final section extracts lessons from the Mexican experience, including possible alternative program designs to address some of the problems encountered in its implementation.

The Effect of Market Structure on Pest Resistance Buildup

In this paper we present a continuous time optimal control analysis of resistance buildup in agricultural chemicals when the supplier is a monopolist. We compare the monopolistic, competitive and socially optimal solutions after establishing the stability of each equilibrium. The central finding is that with a monopolistic supplier, resistance buildup is lower than socially optimal. This directly opposes the standard result in the resistance literature. This implies that policies to manage resistance should vary with the age of the chemical, with no intervention during the lifetime of a patent and an optimal tax once the patent expires.