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Marketing ecosystem services throughprotected areas and rural communitiesin Meso-America:
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 Implications for economic efficiency,equity and political legitimacy
Esteve Corbera, Nicolás Kosoy and Miguel Martínez Tuna
 
October 2006
Tyndall Centre for Climate Change Research
Working Paper 
94
 
Marketing ecosystem services throughprotected areas and rural communitiesin Meso-America:Implications for economic efficiency,equity and political legitimacy
 Dr Esteve Corbera
Overseas Development Group& Tyndall Centre for Climate Change ResearchUniversity of East AngliaEmail:e.corbera@uea.ac.uk 
Nicolás Kosoy
Institut de Ciència i Tecnologia AmbientalsUniversitat Autònoma de Barcelona
Miguel Martínez Tuna
Freshwater ProgrammeWorld Wildlife Fund Central America
Please note that Tyndall working papers are "work in progress". Whilst they are commented on by Tyndall researchers, they have not been subject to a full peer review.The accuracy of this work and the conclusions reached are the responsibility of the author(s)alone and not the Tyndall Centre.
This paper was submitted to
Global Environmental Change –Human and Policy Dimensions- 
 in April 2006 and it is currently under review for re-submission
1
 
 
Summary
Ecosystem services regulate and support natural and human systems throughprocesses such as the cleansing, recycling, and renewal of biological resources,and they are crucial for the long-term viability of human development in economic,social, cultural and ecological terms. Some of these services encompass, forexample, carbon dioxide fixation, watershed regulation, and erosion control. Duringthe last decade, we have seen an increase in the number of projects tradingecosystem services. These projects rest on the premise that they will contribute toenvironmental sustainability and rural development. In this paper we investigate theeconomic and social implications of four projects commercialising watershedrecharge and carbon sequestration by native forests in Meso-America. Sellingecosystem services in protected areas becomes more economically efficient due tonegligible opportunity costs but it also results in less equitable outcomes, as ruralcommunities and forest resource users become excluded from participating indecision-making and accessing development benefits. When ecosystem servicesare commercialised by rural farmers, payments neither cover opportunity costs normeet local income expectations. However, farmers benefit from complementaryproject activities, such as forest management training and agricultural extensionsupport. We argue that limited economic impact and inequitable outcomes can beexplained by problems of institutional design and projects’ inability to account forcontext-related factors, particularly property rights.
1. Introduction
Ecosystem services regulate and support natural and human systems throughprocesses such as the cleansing, recycling, and renewal of biological resources,and they are crucial for the sustainability of human development in economic, social,cultural and ecological terms (Daily
, et al.
, 1997). However, as the world’spopulation and the global economy grow in the future, the demand for theseservices and the likelihood of negative impacts are likely to increase (MillenniumEcosystem Assessment, 2005). For this reason, markets for ecosystem servicesand Payments for Ecosystem Services (PES) are increasingly advocated by globalenvironmental and research institutions as a means to secure the provision of theseservices and solve problems ranging from biodiversity and habitat loss todesertification and climate change (Adger
, et al.
, 2005).Advocacy of markets for ecosystem services and PES is embedded in a logic ofmarket environmentalism which has become prominent since the late 1980s (Smith,1995). As the benefits provided by ecosystem services are neither priced normarketed, resource users do not take into account the degradation of these servicesin their resource management decisions. Market environmentalism thus promotesthe assignation of property rights and pricing of nature’s services, which can then betraded within a market that will assign high prices to scarce services and encouragethe sustainable management of renewable resources (Liverman, 2004). In practice,markets for ecosystem services and PES consist of transferring economic resourcesfrom consumers to providers of ecosystem services so that the former benefiteconomically while the latter receive the
right 
to use the resources provided by theservice in question. It is also argued that markets for ecosystem services and PEScan improve livelihoods and well-being, promote local sustainable forestmanagement and strengthen community-based institutions (Smith and Scherr,2002), as well as enhance ecosystem health (Matthews
, et al.
, 2002) and secure
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