Forest Carbon Supply in Nepal: Evidence from a Choice Experiment

56 Pages Posted: 21 Nov 2018 Last revised: 22 Nov 2018

See all articles by Sahan Dissanayake

Sahan Dissanayake

Colby College - Department of Economics

Randall Bluffstone

University of Reading

Eswaran Somanathan

Indian Statistical Institute

Harisharan Luintel

ForestAction; Portland State University

N. S. Paudel

ForestAction

Michael Toman

World Bank - Development Research Group (DECRG)

Date Written: November 19, 2018

Abstract

This paper uses a choice experiment conducted in Nepal during 2013 to estimate household-level willingness to participate in a village-level program under the Reduced Emissions from Deforestation and Forest Degradation initiative requiring reductions in fuelwood collection, as a function of the price paid per unit of avoided carbon dioxide emissions. The analysis examines incentives to participate both in villages having formal community forest management, the core institution for implementing Reduced Emissions from Deforestation and Forest Degradation, and villages having only informal forest user groups. Contrary to previous findings in the literature about participation incentives, but in keeping with other recent studies of Reduced Emissions from Deforestation and Forest Degradation pilots in Nepal, this study finds that relatively little emission reduction would take place at prices of $1.00 to $5.00 per ton of avoided carbon emissions. Formal community forests will almost certainly be the core institution within which Reduced Emissions from Deforestation and Forest Degradation is implemented in Nepal and likely other countries. The study finds that average and median values of payment required for agreement to reduce fuelwood collection are substantially larger for formal forest user groups than in informal communities. This reflects that formal groups likely already have fuelwood collection restrictions in place, whereas informal groups may de facto permit open access extraction. The analysis also suggests that households that are part of informal groups react to Reduced Emissions from Deforestation and Forest Degradation very differently than households that are formal group members. Broadly speaking, "underprivileged" formal group member households, such as those who are landless, female-headed, and poor, appear to be warier of fuelwood collection restrictions and thus require higher payments than average respondents. This difference does not appear to carry over to informal group members.

Keywords: Forestry, Energy and Natural Resources, Coastal and Marine Resources, Climate Change Mitigation and Green House Gases, Forests and Forestry, Climate Change and Environment, Climate Change and Health, Science of Climate Change, Global Environment, Environmental Disasters & Degradation

Suggested Citation

Dissanayake, Sahan and Bluffstone, Randall and Somanathan, E. and Luintel, Harisharan and Paudel, N. S. and Toman, Michael, Forest Carbon Supply in Nepal: Evidence from a Choice Experiment (November 19, 2018). World Bank Policy Research Working Paper No. 8648. Available at SSRN: https://ssrn.com/abstract=3287520

Sahan Dissanayake (Contact Author)

Colby College - Department of Economics ( email )

Waterville, ME 04901
United States

Randall Bluffstone

University of Reading ( email )

Whiteknights
Reading, Berkshire RG6 6AH
United Kingdom

E. Somanathan

Indian Statistical Institute ( email )

7 S. J. S. Sansanwal Marg
New Delhi, 110016
India

Harisharan Luintel

ForestAction

PO Box: 12207
Lalitpur
Nepal

Portland State University

PO Box 751
Portland, OR 97207
United States

N. S. Paudel

ForestAction

PO Box: 12207
Lalitpur
Nepal

Michael Toman

World Bank - Development Research Group (DECRG) ( email )

1818 H. Street N.W.
MSN3-311
Washington, DC 20433
United States

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