No crowding out among those terminated from an ongoing PES program in Colombia

This paper presents novel evidence of no crowding-out effects, for motivations or donations, among those terminated from an ongoing program of payments for ecosystem services (PES) in Colombia. PES programs have risen in number – yet claims that perverse impacts are common after PES end could inhibit their growth. PES end for different reasons ­(planned duration, budget reduction, issues in implementation) and different ways (some participants or all). One concerned claim about PES is that making payments may lower conservation after PES end if participants’ intrinsic motivations for conservation are ‘crowded out’ by financial incentives. We test for crowding out by an ongoing program in which some but not all contracts were terminated. We see no evidence of crowding out, as conservation motivations and donations for the terminated farmers are not significantly different than for non-PES farmers (and this is robust to matching on levels of assets that affect donations). These results add evidence for an actual PES to literature questioning the ubiquity of crowding out.JEL: H0, Q28, D9