REDD+ sticks and carrots combined: simulating costs and equity effects
in Brazil and Peru
Jan Börner (University of Bonn, CIFOR)
Eduardo Marinho (CIFOR)
Sven Wunder (CIFOR)
Background
• Brazil has effectively reduced deforestation to 70-80% of pre-2004 levels
• Command-and-control (C&C) policies (=“sticks”) are budget-wise cheap – yet costly to land users (Börner et al., 2014)
• Effective C&C may require complementary incentives to remain politically sustainable (Nepstad et al., 2014)
Research questions
1. What tradeoffs between cost effectiveness and land-user income may integration of REDD+ sticks (C&C) and carrots (PES) trigger (Brazil case)?
2. How can incentives be designed to make conservation both cost-effective and egalitarian (Peru case)?
PES design tradeoffsCost-effectiveness
Equality
• Concentration of land ownership• Historical deforestation patterns• Spatially variable opportunity costs• Targeting of payments
Study areas
BRAZILIAN AMAZON
• High historical deforestation
• High concentration of land ownership
• Commercial agriculture and cattle operations at the agricultural frontiers
• Relatively well developed forest monitoring and law enforcement infrastructure
• Large-scale PES planned
PERUVIAN AMAZON
• Historically low deforestation
• More homogeneous distribution of land
• Predominantly subsistence cattle production and small but growing commercial sector
• Relatively weak forest monitoring and law enforcement infrastructure
• Large-scale PES implemented
Modelling decision making
Land user• Deforestation is a function of
expected profits and policy incentives
Envir. Protection Agency
• Enforcement is a budget constrained optimization of deterrence through in situinspections
PESFpdfdd ,max
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Spatial analysis
• District-based opportunity cost analysis
• Grid-based spatial simulation of:
– Avoided deforestation (Brazil, Peru)
– Land user income change (Brazil, Peru)
– Command-and-control implementation costs (Brazil)
– Sticks & carrot integration (Brazil)
– Alternative PES payment modalities (Peru)
Spatial overlayThreatened
forests
Returns to
deforestation
Community
boundaries
Population
PES design tradeoffs
0 2000 4000 6000 8000 10000 12000
0.0
0.2
0.4
0.6
0.8
1.0
Cost-effectiveness: Peruvian Soles per hectare of conserved forest
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ini co
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H in
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current PNCB schemeav. p/ha opp. cost payment
compensation up to av. opp.costav. department p/ha opp. cost paymentav. province p/ha opp. cost payment
1 min. salary per year + pure compensation1 min. salary per year + average opp. cost payment
UNEQUAL & INEFFICIENT
EQUAL & EFFICIENT
Key findings
• Mixing carrots with sticks can make REDD+ fairer, but also more expensive (Brazil)
• If PES are intended to complement C&C (as is common under REDD+) enforcement quality is key to cost-effectiveness
• Designing PES requires knowledge about spatial patterns of deforestation and opportunity costs
• Simple and feasible adjustments to the PNCB can boost its cost-effectiveness and equity effects
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