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Socio-economic impacts of scaling back a massive payments for ecosystem services programme in China

Nature Human Behaviour volume 6, pages 1218–1225 (2022)Cite this article

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Abstract

This paper examines the socio-economic implications of scaling back China’s Sloping Land Conversion Programme (SLCP), one of the world’s largest payments for ecosystem services programmes. Using the consolidation phase of SLCP as a natural experiment, a staggered difference-in-differences design is applied to a panel of rural villages (and households) located in poor and ecologically fragile areas. SLCP consolidation, consisting of a 50% subsidy reduction and suspension of a job training programme, leads to larger income declines in treated villages driven by a reduction in the likelihood that SLCP households transition from farm to non-farm work. These harmful socio-economic effects disappear, however, in villages with stronger land rights and more job training prior to consolidation. When these favourable site-specific characteristics exist, SLCP households remain equally engaged in off-farm work even after subsidy payments and training resources are scaled back. Moreover, on aggregate, village income losses are no longer detectable. The findings provide partial support in favour of the behavioural permanence thesis, highlighting the important role of prevailing local characteristics in mitigating harmful development effects otherwise brought about by programme roll-back.

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Fig. 1: Treatment timing during the SLCP phase II consolidation period.
Fig. 2: Specification chart.
Fig. 3: Group–time treatment effects.
Fig. 4: Treatment effects on village income by sub-grouping.
Fig. 5: Treatment effects on household labour market reallocation.

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Data availability

The de-identified village- and household-level CHVES data were purchased from China’s NBS and made available to the author by the Institute on Ethnology and Anthropology at the IEA-CASS under a data use agreement that prohibits any public sharing of the data. The CHVES data are available from the author upon reasonable request and permission of IEA-CASS.

Code availability

The code for all analyses in this study can be found at https://github.com/AntJam-Howell/SLCP_Consolidation.

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Acknowledgements

The author would like to thank all of the members of the CHVES team as well as colleagues at the School of Public Affairs at ASU for support and feedback during preparation of this manuscript. Any remaining errors are the author's own.

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  1. Arizona State University, Tempe, AZ, USA

    Anthony Howell

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  1. Anthony Howell
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Correspondence to Anthony Howell.

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Nature Human Behaviour thanks Minjuan Zhao and the other, anonymous, reviewer(s) for their contribution to the peer review of this work.

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Howell, A. Socio-economic impacts of scaling back a massive payments for ecosystem services programme in China. Nat Hum Behav 6, 1218–1225 (2022). https://doi.org/10.1038/s41562-022-01401-y

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