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Economic Incentives

Economic Incentives

EcoLogic works with local and indigenous communities, advocating for their inclusion and participation in incentive mechanisms or Payment for Ecosystem Services (PES) programs. Culturally appropriate market‐linked approaches, such as beekeeping and agroforestry production of cash crops like cardamom and cacao, can also incentivize conservation behaviors by shifting the cost-benefit analysis of engaging in activities that result in net conservation benefits. 

Payment for Environmental Services, also called Payment for Ecosystem Services (PES) is a method to provide a group that has some control over a natural resource, such as a forest or freshwater body, with defined incentives to care for that resource so it survives in the long term. Thus PES provides a means to financially support a community or village that protects and/or restores natural resources that are of benefit to everyone, and it offsets the need to turn to extractive and destructive practices to gain necessary income. 

EcoLogic has adopted the term Rewards for Ecosystem Services and Stewardship (RESS) to refer to this kind of system, because RESS gives a more-accurate and more-expansive understanding of how this type of mechanism can work and better encapsulates the way we approach it at the project level. The term RESS, coined by Barry Shelley of Brandeis University’s Heller School for Social Policy and Management in the US, recognizes that the incentives for such protection and restoration can be not only financial ones but can include things like reliable freshwater access. Importantly, RESS also underscores the notion of stewardship: humans, by our actions, can protect and support or destroy a service, but we are not creating it.

The RESS mechanism can also be geared toward self-provision and meeting basic needs while protecting the natural environment. At our Communities Organizing for Watersheds project in Honduras, community members pay a monthly fee to their local water council, in addition to donating time for such activities as planting trees to reforest areas of the watershed, patrolling the forest, cleaning water filter units, and serving on the water councils. In return, the community members receive clean water piped to their homes and the additional benefits of a regenerating forest and protected watershed. In this case, the community members are both the beneficiaries and the contributors, and thus are directly motivated to be positive agents.

In many cases, rural and indigenous peoples in Central America and southern Mexico value and understand the importance of maintaining a healthy coastal mangrove area or a forested water source but are very poor and must choose between, for example, cutting down trees to sell and put food on the table or leaving the trees and going hungry. RESS can respond to this difficult situation, providing both short-term gain—clean water, for example—and long-term gain, the preservation of the watershed that provides the water.

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