Benefits, costs, and livelihood implications of a regional payment for ecosystem service program

Abstract

Despite broad interest in using payment for ecosystem services to promote changes in the use of natural capital, there are few expost assessments of impacts of payment for ecosystem services programs on ecosystem service provision, program cost, and changes in livelihoods resulting from program participation. In this paper, we evaluate the Paddy Land-to-Dry Land (PLDL) program in Beijing, China, and associated changes in service providers' livelihood activities. The PLDL is a land use conversion program that aims to protect water quality and quantity for the only surface water reservoir that serves Beijing, China's capital city with nearly 20 million residents. Our analysis integrates hydrologic data with household survey data and shows that the PLDL generates benefits of improved water quantity and quality that exceed the costs of reduced agricultural output. The PLDL has an overall benefitcost ratio of 1.5, and both downstream beneficiaries and upstream providers gain from the program. Household data show that changes in livelihood activities may offset some of the desired effects of the program through increased expenditures on agricultural fertilizers. Overall, however, reductions in fertilizer leaching from land use change dominate so that the program still has a positive net impact on water quality. This program is a successful example of water users paying upstream landholders to improve water quantity and quality through land use change. Program evaluation also highlights the importance of considering behavioral changes by program participants.social-ecological systems | sustainable household livelihoods | watershed management | sustainability | regional collaboration P ayment for ecosystem services (PES) can serve as an effective mechanism to translate external, nonmarket values of ecosystem services into financial incentives for local actors to provide such services (1), and has been highlighted as an innovative approach to integrate conservation and socioeconomic development (2-4). In principle, when the benefits derived from increased provision of ecosystem services exceed the cost of provision, PES mechanisms can make both ecosystem service beneficiaries and providers better off. Despite considerable promise and interest in the use of PES worldwide and increasing assessments of the benefits and costs of PES programs, there is little documentation of resulting changes in program participants' livelihoods. Livelihood changes can alter the total effect of a program through unintended changes in an area's economic structure or other natural capital assets (5-8). Taking stock of these socioeconomic impacts highlights the dynamic and distributional effects of PES programs, and is necessary for understanding the equity implications and overall efficiency of a program.Beijing faces a water crisis requiring urgent solutions, and PES programs are one strategy being used to protect water resources. The Miyun Reservoir is the only surface water source for domestic water in Beijing. Its main purpose is to supply...

Estimation of Rural Households’ Willingness to Accept Two PES Programs and Their Service Valuation in the Miyun Reservoir Catchment, China

“…The MRC has an area of 15,788 km 2 , 80% of which is located in the separately governed province of Hebei ( Figure 1a). Not only does this crossjurisdictional characteristic increase the difficulties in administration, but also it complicates development interests for both upstream and downstream stakeholders [46]. converted all 6867 ha of rice fields to dryland crops [46].…”

“…Not only does this crossjurisdictional characteristic increase the difficulties in administration, but also it complicates development interests for both upstream and downstream stakeholders [46]. converted all 6867 ha of rice fields to dryland crops [46]. In addition the JAPEWP program initiated in 2009 is restoring forest landscapes in key source water areas to sustain and improve ES related to water yield and purification, as moderate forest cover can have positive effects on these [3,47].…”

Household Livelihood Strategy Choices, Impact Factors, and Environmental Consequences in Miyun Reservoir Watershed, China

“…These outcomes impact the overall sustainability of a livelihood portfolio. In light of these different livelihood consequences and contexts, policy makers try to improve the sustainability of household livelihood outcomes through policy innovation (e.g., eco-compensation, infrastructure construction, educational investment) [26][27][28][29][30]. Here, we first classify household livelihood strategy choices and then examine factors that impact different types of livelihood strategies and their possible livelihood consequences based on our data.…”

Spatial patterns of agricultural expansion determine impacts on biodiversity and carbon storage

“…(Integrated Valuation of Ecosystem Services and Trade-Offs) (15), GLOBIO (16), ARIES (17), and others, are now being used to help inform a wide range of decisions related to land-use planning, infrastructure investment, urban water supplies, and disaster risk reduction (18)(19)(20)(21). In contrast to much of this sitebased work often occurring in governmental decision contexts, considerations of biodiversity and ES by corporations and multilateral organizations typically rely on approaches that assign an amount of benefit or impact on a per-area basis, without representation of spatial variability (22).…”