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Only One Tree from Each Seed? Environmental Effectiveness and Poverty Alleviation in Mexico's Payments for Ecosystem Services Program

Author

Listed:
  • Jennifer M. Alix-Garcia
  • Katharine R. E. Sims
  • Patricia Yañez-Pagans

Abstract

Environmental conditional cash transfers are popular but their impacts are not well understood. We evaluate land cover and wealth impacts of a federal program that pays landowners for protecting forest. Panel data for program beneficiaries and rejected applicants allow us to control for fixed differences and time trends affecting both groups. We find the program reduces the expected land cover loss by 40-51 percent and generates small but positive poverty alleviation. Environmental gains are higher where poverty is low while household gains are higher where deforestation risk is low, illustrating the difficulty of meeting multiple policy goals with one tool. (JEL I32, I38, O13, O15, Q23, Q28, Q56)

Suggested Citation

  • Jennifer M. Alix-Garcia & Katharine R. E. Sims & Patricia Yañez-Pagans, 2015. "Only One Tree from Each Seed? Environmental Effectiveness and Poverty Alleviation in Mexico's Payments for Ecosystem Services Program," American Economic Journal: Economic Policy, American Economic Association, vol. 7(4), pages 1-40, November.
    • Handle: RePEc:aea:aejpol:v:7:y:2015:i:4:p:1-40
    Note: DOI: 10.1257/pol.20130139
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    More about this item

    JEL classification:

    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • Q23 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Forestry
    • Q28 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Government Policy
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth

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