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Payments for environmental services (PES) are often viewed as a way to simultaneously improve conservation outcomes and the wellbeing of rural households who receive the payments. However, evidence for such win-win outcomes has been elusive. We add to the growing literature on conservation program impacts by using primary household survey data to evaluate the socioeconomic impacts of participation in Costa Rica’s PES program. Despite the substantial cash transfers to voluntary participants in this program, we do not detect any evidence of impacts on their wealth or self-reported well-being using a quasi-experimental design. These results are consistent with the common claim that voluntary PES do not harm participants, but they beg the question of why landowners participate if they do not benefit. Landowners in our sample voluntarily renewed their contracts after five years in the program and thus are unlikely to have underestimated their costs of participation. They apparently did not invest additional income from the program in farm inputs such as cattle or hired labor, since both decreased as a result of participation. Nor do we find evidence that participation encouraged moves off-farm. Instead, semi-structured interviews suggest that participants joined the program to secure their property rights and contribute to the public good of forest conservation. Thus, in order to understand the social impacts of PES, we need to look beyond simple economic rationales and material outcomes. [ABSTRACT FROM AUTHOR]

Payments for environmental services (PES) are popular despite little empirical evidence of their effectiveness. We estimate the impact of PES on forest cover in a region known for exemplar, implementation of one of the best-known and longest-lived PES programs. Our evaluation design combines sampling that incorporates prematching, data from remote sensing and household surveys, and empirical methods that include partial identification with weak assumptions, difference-in-differences matching estimators, and tests of sensitivity to unobservable heterogeneity. PES in our study site increased participating farm forest cover by about 11% to 17% of the mean area under PES contract over eight years. [ABSTRACT FROM AUTHOR]

The Costa Rican Program of Payments for Environmental Services provides financial compensation to forest owners for the environmental services generated by their forests. This program offers a unique opportunity to evaluate the impacts of direct incentive payments on conservation. In order to measure the causal effect of this program on outcomes of interest, it is fundamental to understand the factors that influence enrollment in the program. Economic theory suggests that opportunity costs are key, but many factors may determine and mediate the influence of these costs. This article reports findings from an integrated qualitative and quantitative approach to this question. Within an iterative field research framework, information was gathered through (a) semistructured interviews with government officials and forestry professionals, (b) case studies of participant and nonparticipant forest landowners based on in-depth interviews, field visits, and a review of records, and (c) a quantitative survey of participant and nonparticipant landowners. The semistructured interviews and case studies provide important insights that can be incorporated into the quantitative analysis, specifically by identifying potential determinants of program participation and land use change. Hypotheses about the relationship between program participation and the opportunity costs of participation are confirmed using both approaches. [ABSTRACT FROM AUTHOR]