Encouraging Conservation: Payment for Ecosystem Services

In developed and developing economies alike, there is economic incentive to deforest land for other uses, such as farmland. This is because the crops can be sold at a profit, while leaving the forest alone results in no profit. However, although forests do not turn a profit by standing there, they provide a wealth of benefits to the communities that

Deforested land in the DR

surround them and to the global climate. For example, forests provide raw materials, promote soil fertility and prevent soil erosion, stabilize slopes and prevent landslides. Forests are spaces for hiking and adventure, provide habitat and shade, regulate local climates, and remove pollutants from the atmosphere and absorb and store carbon dioxide.

The benefits of forests described above are all examples of ecosystem services. Ecosystem services are defined as any positive benefit that ecosystems provide to people. The UN sponsored Millennium Ecosystem Assessment recently identified the major categories of ecosystem services: Provisioning (providing material or energy outputs), Regulating (moderating natural phenomena), Supporting (maintaining habitats and biodiversity), or Cultural (relating to tourism, aesthetics, and recreation). The ecosystem services forests provide fall under

Forested land in the DR

each of those categories. From this perspective, forests are obviously valuable, but again forests left alone do not turn a profit, while cutting them down does. Therefore, forests are being cut down around the world at a rate faster than they can regrow. So, how do we change that? How do we encourage conservation without putting people out of jobs or removing their source of income? 

For economists, the answer is simple: give landowners economic incentives to conserve forests and/or to cut them down only at sustainable rates. To do this, economists start by estimating the monetary value of the ecosystem services the forests provide. Attaching monetary value to ecosystem services allows economists to determine the optimal amount governments would have to pay land owners in exchange for a promise to conserve their land for a certain period of time. The optimal amount has to be equal or greater to the potential income a landowner could gain by using the land immediately for other purposes, otherwise, there would still be no economic incentive to conserve the land. Payment for ecosystem services (PES) creates a market for conservation. Without PES, ecosystem services are on their own socially and environmentally valuable. With PES, ecosystem services become economically valuable, too.

F2F Volunteers Glen Juergens, Bill Ryburn,
and Dave Lombardo with field staff and hosts in the DR

Over the last couple of years, F2F volunteers Glen Juergens, Bill Ryburn, and Dave Lombardo have worked with hosts on multiple assignments in the Dominican Republic to help them figure out how they can encourage reforestation, healthy management of forested land, and conservation of forested land through PES. The F2F volunteers educated local NGOs on how to create a PES system, how to calculate the optimal payment amounts, and how to properly implement a PES system so that it would garner the best results. F2F is also planning subsequent assignments to follow up on this work. The long-term goal is increased conservation, economically and environmentally sustainable land use practices, and a more secure future for landowners in the Dominican Republic.

Ecosystem services can be small, large, direct, or indirect; they can be provisioning, regulating, supporting, or cultural. But they can’t be fully recreated by humans. Therefore, conserving ecosystems is essential if we want to continue benefiting from their services, and PES is one viable way to encourage conservation around the world.