There has been a recent explosion of interest in market mechanisms to capture global ecosystem service values. An argument in their favour is that they can, in principle, benefit the poor by increasing the value of their resources. However, the effect on poverty is not easily predicted and depends on a) the structure and distribution of payments (how and when payments are made, and to whom) and b) how land-use changes driven by the payments influence the supply of locally important ecosystem services and livelihood options to poor people.

Our central research question...
How can international ecosystem service payment schemes (specifically for carbon sequestration/storage and biodiversity conservation) most effectively reduce poverty in low income countries, given bio-physical, economic and political realities?

This question is of vital importance as there have been few, if any, detailed multi-dimensional assessments of either existing programmes or the conditions needed for optimal programme design. We focus on a single ecosystem (tropical forest) in a single low income country (Madagascar) to achieve a uniquely complete analysis. Links to global structures involved in developing international payment for ecosystem services schemes (PES) ensure the results will be influential more widely.

Major land-use changes which international payments are incentivizing include: reduced deforestation, targeted restoration or reforestation (through fire and grazing management or replanting) and changes in rules, or enforcement of rules, governing access to harvesting wild products. Welfare impacts on the poor will be different under these different approaches, and they vary in their potential for producing global benefits.