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Putting Payments for Environmental Services in the Context of Economic Development

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Payment for Environmental Services in Agricultural Landscapes

Part of the book series: Natural Resource Management and Policy ((NRMP,volume 31))

Abstract

Paying for the provision of environmental services (ES) is a recent policy innovation attracting much attention in both developed and developing countries. Linking payments for environmental services (PES) to economic development and poverty reduction is important since they may represent a new source of finance to developing countries that are potentially important suppliers of global ES. In this chapter we apply concepts from natural resource and environmental economics to a wide range of issues associated with the introduction of PES programs in the context of economic development. We introduce an economic typology of PES, showing how they can provide a solution to externalities and public good problems within the bounds of political economic constraints. Secondly, we focus on the problem of who should, and will, pay for ES. Third, we will turn to issues of program design. We assess the issue of targeting payments to achieve their objectives efficiently, with attention to the equity implications of PES programs. The final section addresses issues of monitoring and enforcement of PES contracts, and we summarize the key findings in the conclusion.

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Notes

  1. 1.

    1Externalities occur when the supplier or consumer of a good does not bear all the costs of its production or consumption. Marginal private costs are less than marginal social costs of production or consumption.

  2. 2.

    [2]Even so, there are already PES programs targeting community groups and not individuals; c.f. FAO, (2007); Munoz-Pina et al., (2005); Smith and Scherr, (2003); Swallow et al., (2007).

  3. 3.

    [3]For example, enclosure or defining individual rights can be prohibitively expensive; also, privatization can lead to a loss of access to land resources on the part of the poor as elites move to capture the increased benefits.

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Author information

Authors and Affiliations

  1. International Food Policy Research Institute, Washington, DC, USA

    Nancy McCarthy

Authors
  1. David Zilberman
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  2. Leslie Lipper
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  3. Nancy McCarthy
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Editor information

Editors and Affiliations

  1. Agricultural and Development Economics Division, Food and Agriculture Organization, United Nations, Rome, Italy

    Leslie Lipper  & Takumi Sakuyama  & 

  2. School of Agriculture, Food and Wine, University of Adelaide, Glen, Osmond

    Randy Stringer

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© 2009 FAO

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Zilberman, D., Lipper, L., McCarthy, N. (2009). Putting Payments for Environmental Services in the Context of Economic Development. In: Lipper, L., Sakuyama, T., Stringer, R., Zilberman, D. (eds) Payment for Environmental Services in Agricultural Landscapes. Natural Resource Management and Policy, vol 31. Springer, New York, NY. https://doi.org/10.1007/978-0-387-72971-8_2

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