Paul J. Ferraro

Money for nothing? A call for empirical evaluation of biodiversity conservation investments

The field of conservation policy must adopt state-of-the-art program evaluation methods to determine what works, and when, if we are to stem the global decline of biodiversity and improve the effectiveness of conservation investments.

Measuring the effectiveness of protected area networks in reducing deforestation.

Global efforts to reduce tropical deforestation rely heavily on the establishment of protected areas. Measuring the effectiveness of these areas is difficult because the amount of deforestation that would have occurred in the absence of legal protection cannot be directly observed. Conventional methods of evaluating the effectiveness of protected areas can be biased because protection is not randomly assigned and because protection can induce deforestation spillovers (displacement) to neighboring forests. We demonstrate that estimates of effectiveness can be substantially improved by controlling for biases along dimensions that are observable, measuring spatial spillovers, and testing the sensitivity of estimates to potential hidden biases. We apply matching methods to evaluate the impact on deforestation of Costa Ricas renowned protected-area system between 1960 and 1997. We find that protection reduced deforestation: approximately 10% of the protected forests would have been deforested had they not been protected. Conventional approaches to evaluating conservation impact, which fail to control for observable covariates correlated with both protection and deforestation, substantially overestimate avoided deforestation (by over 65%, based on our estimates). We also find that deforestation spillovers from protected to unprotected forests are negligible. Our conclusions are robust to potential hidden bias, as well as to changes in modeling assumptions. Our results show that, with appropriate empirical methods, conservation scientists and policy makers can better understand the relationships between human and natural systems and can use this to guide their attempts to protect critical ecosystem services.

Show me the money: do payments supply environmental services in developing countries?

Many of the services supplied by nature are externalities. Economic theory suggests that some form of subsidy or contracting between the beneficiaries and the providers could result in an optimal supply of environmental services. Moreover, if the poor own resources that give them a comparative advantage in the supply of environmental services, then payments for environmental services (PES) can improve environmental and poverty outcomes. While the theory is relatively straightforward, the practice is not, particularly in developing countries where institutions are weak. This article reviews the empirical literature on PES additionality by asking, “Do payments deliver environmental services, everything else being equal, or, at least, the land-use changes believed to generate environmental services?” We examine both qualitative case studies and rigorous econometric quasi-experimental analyses. We find that government-coordinated PES have caused modest or no reversal of deforestation. Case studies of smaller-scale, user-financed PES schemes claim more substantial impacts, but few of these studies eliminate rival explanations for the positive effects. We conclude by discussing how the dearth of evidence about PES impacts, and unanswered questions about institutional preconditions and motivational “crowding out,” limit the prospects for using international carbon payments to reduce emissions from deforestation and degradation.

ECOSYSTEM SERVICES AND ECONOMIC THEORY: INTEGRATION FOR POLICY‐RELEVANT RESEARCH

It has become essential in policy and decision-making circles to think about the economic benefits (in addition to moral and scientific motivations) humans derive from well-functioning ecosystems. The concept of ecosystem services has been developed to address this link between ecosystems and human welfare. Since policy decisions are often evaluated through cost-benefit assessments, an economic analysis can help make ecosystem service research operational. In this paper we provide some simple economic analyses to discuss key concepts involved in formalizing ecosystem service research. These include the distinction between services and benefits, understanding the importance of marginal ecosystem changes, formalizing the idea of a safe minimum standard for ecosystem service provision, and discussing how to capture the public benefits of ecosystem services. We discuss how the integration of economic concepts and ecosystem services can provide policy and decision makers with a fuller spectrum of information for making conservation-conversion trade-offs. We include the results from a survey of the literature and a questionnaire of researchers regarding how ecosystem service research can be integrated into the policy process. We feel this discussion of economic concepts will be a practical aid for ecosystem service research to become more immediately policy relevant.

One Hundred Questions of Importance to the Conservation of Global Biological Diversity

We identified 100 scientific questions that, if answered, would have the greatest impact on conservation practice and policy. Representatives from 21 international organizations, regional sections and working groups of the Society for Conservation Biology, and 12 academics, from all continents except Antarctica, compiled 2291 questions of relevance to conservation of biological diversity worldwide. The questions were gathered from 761 individuals through workshops, email requests, and discussions. Voting by email to short-list questions, followed by a 2-day workshop, was used to derive the final list of 100 questions. Most of the final questions were derived through a process of modification and combination as the workshop progressed. The questions are divided into 12 sections: ecosystem functions and services, climate change, technological change, protected areas, ecosystem management and restoration, terrestrial ecosystems, marine ecosystems, freshwater ecosystems, species management, organizational systems and processes, societal context and change, and impacts of conservation interventions. We anticipate that these questions will help identify new directions for researchers and assist funders in directing funds.

The Cost-Effectiveness of Conservation Payments

International donors invest billions of dollars to conserve ecosystems in low-income nations. The most common investments aim to encourage commercial activities, such as ecotourism, that indirectly generate ecosystem protection as a joint product. We demonstrate that paying for ecosystem protection directly can be far more cost-effective. Although direct-payment initiatives have imposing institutional requirements, we argue that all conservation initiatives face similar challenges. Thus conservation practitioners would be well advised to implement the first-best direct-payment approach, rather than a second-best policy option. An empirical example illustrates the spectacular cost savings that can be realized by direct-payment initiatives. (JEL H21, Q28)

Protected areas reduced poverty in Costa Rica and Thailand

As global efforts to protect ecosystems expand, the socioeconomic impact of protected areas on neighboring human communities continues to be a source of intense debate. The debate persists because previous studies do not directly measure socioeconomic outcomes and do not use appropriate comparison groups to account for potential confounders. We illustrate an approach using comprehensive national datasets and quasi-experimental matching methods. We estimate impacts of protected area systems on poverty in Costa Rica and Thailand and find that although communities near protected areas are indeed substantially poorer than national averages, an analysis based on comparison with appropriate controls does not support the hypothesis that these differences can be attributed to protected areas. In contrast, the results indicate that the net impact of ecosystem protection was to alleviate poverty.

Using Non-Pecuniary Strategies to Influence Behavior: Evidence from a Large Scale Field Experiment

Policymakers are increasingly using norm-based messages to influence individual decision making. We partner with a metropolitan water utility to implement a natural field experiment to examine the effect of such messages on residential water demand. The data, drawn from more than 100,000 households, indicate that social comparison messages had a greater influence on behavior than simple prosocial messages or technical information alone. Moreover, our data suggest that social comparison messages are most effective among households identified as the least price sensitive: high users. Yet the effectiveness of such messages wanes over time. Our results thus highlight important complementarities between pecuniary and nonpecuniary strategies.

The local costs of establishing protected areas in low-income nations: Ranomafana National Park, Madagascar

Abstract Over the last 20 years, governments and influential donor organizations have come to realize that the long-term integrity of protected areas in low-income nations depends critically upon the support of rural communities that live adjacent to them. Despite the recognized need for understanding the opportunity costs of conservation borne by rural communities adjacent to protected areas, there exist few quantitative analyses of the local effects of protected area establishment. Using a unique household data set from southeastern Madagascar, I estimate the opportunity costs borne by residents resulting from the establishment of the Ranomafana National Park in 1991. I conservatively estimate the present value of the opportunity costs to be

Conditions associated with protected area success in conservation and poverty reduction

3.37 million. The costs are not distributed evenly across households around the park. The average present value of costs per household in four zones around the park ranges from