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School of Economics and Business, Norwegian University of Life Sciences Working Paper Series, School of Economics and Business, Norwegian University of Life Sciences

No 02-2016:
Pay little, get little; pay more, get a little more: A framed forest experiment in Tanzania

ōyvind Nystad Handberg () and Arild Angelsen ()

Abstract: How do different levels of individual payments for environmental services (PES) affect intrinsic and social motivations for forest conservation? Does introducing low levels of PES crowd out these motivations? This paper presents findings from framed field experiments (FFE) conducted with local forest users in Tanzania. The payoff structure represents a common-pool resource situation; participantsí payoffs depend on the number of trees harvested, and aggregate over-harvesting can harm future harvest. Four levels of individual PES are tested in a between-group design: no (0%), low (20%), medium (60%) and full (100%) PES, where the level is relative to the harvest value. We observe lower than theoretically predicted harvest rates at no, low and medium PES, while the opposite is true at full PES. Low PES has a weak negative effect on harvest rates among certain subgroups, while medium and full PES give strong reductions in harvest rates (c. -43% and -75%). The results suggest that low PES has little impact on local forest use in Tanzania and has on aggregate a neutral effect on intrinsic and social motivations. Increasing payments has a negative, but diminishing effect on harvest rates.

Keywords: Field experiment; PES; REDD; crowding-out; forest management; Tanzania; (follow links to similar papers)

JEL-Codes: C93; Q23; (follow links to similar papers)

35 pages, January 12, 2016

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