Sidney Verba Lecture Featuring Kristopher Ramsay

Dept of Government at Harvard Office

Belfer Case Study Room (S020), CGIS South, 1730 Cambridge St., Cambridge, MA 02138

Conservation for Sale: International Bargaining over Payment for Ecosystem Services

Recent years have seen a proliferation of international conservation agreements. Under the UN’s program for Reducing Emissions from Deforestation and Forest Degradation (REDD+) developing countries can receive payments from interested parties in exchange for conserving their forests. We study such programs and ask when countries can reach agreements to conserve natural resources. Specifically, we analyze a formal model where a developing country controls a limited non-renewable resource that they prefer to consume, while another country prefers that it be preserved. We present four main results. First, successful conservation is only possible once the forest is sufficiently small. Second, there exists a trade-off between conservation and the share of bargaining surplus that goes to the developing country. Third, by allowing leakage, developing countries can increase their rents from agreement, but simultaneously undermine conservation. Finally, conservation is maximized and leakage averted when developing countries dictate the terms of agreements.