Estimate the Impact of Payments for Environmental Services on Local Livelihoods and Environment: An Application of Propensity Scores

Abstract

Payments for environmental services (PES) are usually considered as a useful tool to both protect the environment and generate multiple income streams for mountainous households who receive the payments, and thus, it has been widely implementing in many developing countries so far; however, the impact of it on local livelihoods and environment has been questioned. Therefore, the article aimed to evaluate the Vietnamese PES scheme’s effect on both environment and local livelihoods by surveying 282 households living in Quang Nam, Vietnam, and utilized the propensity score matching (PSM) technique to investigate the intervention policy’s influence. Furthermore, to evaluate PES’s effect on the environment, the article used Normalized Difference Vegetation Index (NDVI) as a measure of the photosynthetic level of forest trees. The calculation of NDVI relied on satellite images downloaded from the Moderate Resolution Imaging Spectroradiometer. The results indicated that (a) the natural forest status has been improved during PES implementation compared with that of pre-PES period regarding total forest areas, percentage of forest coverage, and vegetation cover; and (b) PES-participants have got a significantly lower income than nonparticipants regarding total annual income, agricultural income, and hired labor income. The limitation is that the impact of interventions on livelihoods and the environment is determined by the mutual combination of implemented programs rather than only the PES regime. So, we highly recommend that the future study separate the PES scheme’s actual impact to precisely evaluate the PES project’s effect on financial and environmental outcomes.

Payments for ecosystem services programs: A global review of contributions towards sustainability

“…Some PESPs, however, have created a substantial lower income for PES-participants than non-participants, e.g., total household income/year, on-farm income/year, and hired labor income/year [ 41 ] (C8, C10, C2→C11: −). Non-participants may be excluded from the programs and deprived of access to natural resources [ 40 ].…”

“…Although many successful PESPs have been reported [ 1 , 18 , 34 ], the effectiveness of PESPs for conservation policy and sustainable livelihoods still remains controversial [ 13 , [35] , [36] , [37] , [38] ]. Implementing PESPs has led to a series of cross-regional issues [ 39 ] and negative effects such as widening the gap between rich and poor [ 29 ] and other dimensions of inequality (e.g., non-participants excluded from PESPs and deprived of access to natural resources [ 40 ], PESP participants’ income lower than nonparticipants [ 41 ]), etc.). As PESPs spread across the globe [ 1 , [13] , [14] , [15] , [16] , [17] , [18] ], there are also hundreds of studies released yearly on various aspects of PESPs [ 42 , 43 ], but research on how PESPs are related to sustainability [ 44 ] has failed to attract scholars to explore the core analysis related to environmental policy and practice [ 45 ].…”

Payments for environmental services in Mangrove Forests: A review and recommendations

“…The ecosystem services approach is a growing trend that aims to harness the benefits that nature provides (Nguyen et al 2021). Environmental services offer various advantages from nature to individuals, communities, and the economy, such as food chains or benefits derived from forest and wetland ecosystems (agricultural products, timber, seafood, landscape value for tourism, etc.)…”