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Lessons from Applying Market-Based Incentives in Watershed Management

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  • Edwin Muchapondwa

    (School of Economics, University of Cape Town, Rondebosch 7701, South Africa†Department of Business Administration, Technology and Social Sciences, Luleå University of Technology, 971 87 Luleå, Sweden)

  • Jesper Stage

    (#x2020;Department of Business Administration, Technology and Social Sciences, Luleå University of Technology, 971 87 Luleå, Sweden)

  • Eric Mungatana

    (#x2021;Department of Agricultural Economics, University of Pretoria, Pretoria 0002, South Africa)

  • Pushpam Kumar

    (#xA7;Ecosystems Division, United Nations Environment, Nairobi 0010, Kenya)

Abstract

Watershed management is a complex activity with constraints on funding and human resources in many parts of the world, and there is a need for global effort to identify strategies that can work. To complement regulatory approaches, attention is now also being given to market-based incentives because of their potential cost-effectiveness. This study seeks to provide impetus to the use of the most successful market-based incentives to promote sustainable watershed practices through strengthening and increasing direct participation by local communities and the private sector. To identify proven market-based incentives for use to catalyze local community and private sector participation, a review of a sample of 26 purposively selected case studies from different contexts in Africa, Asia, Europe and the Americas is conducted. In reviewing those case studies, emphasis is placed on understanding the threats to specific watersheds, the market-based incentives used, the countrywide policy environment, the outcomes from the interventions, the factors for success and failure, and the pertinent policy issues in support of upscaling and the uptake of appropriate market-based approaches. The study identifies seven key policies that Governments should consider to upscale and facilitate the uptake of market-based incentives to promote participation by local communities and the private sector in watershed management.

Suggested Citation

  • Edwin Muchapondwa & Jesper Stage & Eric Mungatana & Pushpam Kumar, 2018. "Lessons from Applying Market-Based Incentives in Watershed Management," Water Economics and Policy (WEP), World Scientific Publishing Co. Pte. Ltd., vol. 4(03), pages 1-41, July.
  • Handle: RePEc:wsi:wepxxx:v:04:y:2018:i:03:n:s2382624x1850011x
    DOI: 10.1142/S2382624X1850011X
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    References listed on IDEAS

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    2. Pagiola, Stefano, 2008. "Payments for environmental services in Costa Rica," Ecological Economics, Elsevier, vol. 65(4), pages 712-724, May.
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