Forest Conservation and Slippage: Evidence from Mexico's National Payments for Ecosystem Services Program

  • Alix-Garcia J
  • Shapiro E
  • Sims K
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We investigate a Mexican federal pro-gram that compensates landowners for forest protec-tion. We use matched controls from the program applicant pool to establish counterfactual deforesta-tion rates. Deforestation was reduced by 50% in en-rolled parcels, but expected average clearing rates without the program were low (0.8% per year), sug-gesting modest total avoided deforestation benefits. We test for two types of slippage: increased defores-tation on other property belonging to program recip-ients and increased deforestation within markets where there are high levels of program participation. We find evidence of both, with substitution impacts reducing program effectiveness in common properties by about 4% on average. (JEL O13, Q24)

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  • J. M. Alix-Garcia

  • E. N. Shapiro

  • K. R. E. Sims

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