Values, Payments and Institutions for Ecosystem Management

Values, Payments and Institutions for Ecosystem Management

A Developing Country Perspective

Edited by Pushpam Kumar and Ibrahim Thiaw

Using a selection of authoritative and original contributions, this timely book explores the uncertainty surrounding the impact of decisions undertaken to manage ecosystem services worldwide. Invariably, the policies designed and implemented to manage forests, wetlands, and marine and coastal environments often involve conflicts of interest between various stakeholders. This has added an additional layer of complexity in the context of developing countries where institutions and governance are weak or absent. Economic valuation and the subsequent design of innovative response tools such as payment for ecosystem services (PES) have the potential to offer far greater transparency. In the case of LDCs, the identification of suitable institutions for executing these tools is also of vital importance.

Chapter 6: Are the amounts of payments for environmental services enough to contribute to poverty alleviation efforts in developing countries?

Luis C. Rodriguez, Unai Pascual and Roldan Muradian

Subjects: development studies, development economics, economics and finance, development economics, environmental economics, environment, ecological economics, environmental economics, management natural resources, valuation


Environmental conservation and poverty reduction are two areas receiving increasing attention from donors, governments, research organizations and development agencies around the world (Sachs and Reid 2006). The use of market-based instruments, such as payments for ecosystem services (PES) or conditional cash transfers (CCT), is considered to be among the most cost-effective instruments to achieve these environmental (Ferraro and Simpson 2002) and social (Rawlings 2005) goals. Both approaches involve payments that are transferred to a number of selected beneficiaries, previously identified in a targeting exercise as fulfilling a number of conditions designed to internalize an environmental externality in the case of PES, or a social externality in the case of CCT (Wunder 2007; World Bank 2009). Thus, PES are aimed at compensating landholders for the cost of providing positive environmental services to stakeholders that can directly pay (by market transaction) or indirectly pay (by using public funds from taxes or donors) for the services they expect to receive.

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