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Discussion Paper Details

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Title: Cash for Carbon: A Randomized Controlled Trial of Payments for Ecosystem Services to Reduce Deforestation

Author(s): Joost de De Laat, Seema Jayachandran, Eric F. Lambin and Charlotte Stanton

Publication Date: June 2016

Keyword(s): climate change, conditional cash transfers, deforestation and REDD+

Programme Area(s): Development Economics

Abstract: This paper evaluates a Payments for Ecosystem Services (PES) program in western Uganda that offered forest-owning households cash payments if they conserved their forest. The program was implemented as a randomized trial in 121 villages, 60 of which received the program for two years. The PES program reduced deforestation and forest degradation: Tree cover, measured using high-resolution satellite imagery, declined by 2% to 5% in treatment villages compared to 7% to 10% in control villages during the study period. We find no evidence of shifting of tree-cutting to nearby land. We then use the estimated effect size and the social cost of carbon to value the delayed CO2 emissions, and compare this benefit to the program's cost.

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Bibliographic Reference

De Laat, J, Jayachandran, S, Lambin, E and Stanton, C. 2016. 'Cash for Carbon: A Randomized Controlled Trial of Payments for Ecosystem Services to Reduce Deforestation'. London, Centre for Economic Policy Research. https://cepr.org/active/publications/discussion_papers/dp.php?dpno=11349