Do Payments Pay Off? Evidence from Participation in Costa Rica's PES Program

Area of Science:

• Environmental economics
• Conservation science
• Rural sociology

Background:

• Payments for environmental services (PES) programs aim for dual conservation and socioeconomic benefits.
• Evidence for these "win-win" outcomes in PES programs remains limited.
• Understanding participant motivations beyond economic incentives is crucial.

Purpose of the Study:

• To evaluate the socioeconomic impacts of Costa Rica's PES program on rural households.
• To investigate the reasons behind voluntary participation and contract renewal in PES programs.
• To explore non-economic rationales for landowner engagement in conservation initiatives.

Main Methods:

• Utilized primary household survey data and a quasi-experimental design.
• Analyzed socioeconomic impacts, including wealth and well-being indicators.
• Conducted semi-structured interviews to understand participant motivations.

Main Results:

• No detectable impact on participant wealth or self-reported well-being was found.
• Participation did not lead to increased investment in farm inputs like cattle or hired labor; these decreased.
• No evidence suggested participation encouraged migration off-farm.

Conclusions:

• Voluntary PES programs may not yield direct economic benefits for participants.
• Landowners participate in PES for reasons beyond immediate financial gain, such as property rights security and environmental stewardship.
• Assessing the social impacts of PES requires considering non-material motivations and outcomes.