The document analyzes the impact of land conservation policies on deforestation rates in Costa Rica between 2000-2005. Using empirical analysis methods like propensity score matching and covariate matching, it finds that Costa Rica's Payments for Environmental Services Program (PES) reduced deforestation rates by around 2% during this period. For national parks, it estimates that only around 2% of the land within park boundaries would have been deforested without the parks. So both policies had a small but statistically significant impact on reducing deforestation, with PES performing slightly better.

1. Impact of Land Conservation Policies on Deforestation Rates in Costa Rica Juan A. Robalino, CATIE and Alexander Pfaff, Duke Arturo Sanchez, University of Alberta Francisco Alpizar, CATIE Carlos Leon, Neotropica and Carlos Manuel Rodriguez Paul Ferraro GSU Kwaw Andam IFPRI

10. Matching Strategies Treated observations: Plots in PES or National Parks Untreated Observations: Plots away outside PES or National Parks

14. Results: Testing similarity 3355 0.95 3504 3502 Precipitation 5.4 0.40 5.3 5.1 Distance Nat. Parks 3.3 0.71 1.5 1.5 Distance to Rivers 156 km 0.62 144 km 142 km Distance to Limon 66% 0.83 42% 49% Slopes 5.5 0.34 5.9 6.1 Distance Nat. Roads 3.3 km 0.02 3.2 km 3.5 km Distance Local Roads 122 km 0.32 119 km 121 km Distance to Caldera 114 km 0.48 101 km 102 km Distance to San Jose 43% 0.21 58% 61% Bad L. Zones for Ag. 32% 0.34 23% 22% Good L. Zones for Ag. All Controls Significance P-value Matched Controls Treated

15. Results: PES Program Effects: Pixel analysis and ** represent 5% and 1% significance level respectively Model 1 is controlling for: Life Zones, Distance to SJ and main ports and Slope Model 2 is controlling also for: Distance to Roads and Rivers -2.09* -2.11** CVM Program Effects on Deforestation (%) 2000-2005 N=4 -2.00** -1.40** -1.62** OLS -1.66* PSM No Bias adjustment 1.92** 1.89** CVM 2.32** 1.59** OLS 1.87** PSM With Bias adjustment Model 1 Model 2

18. Park Impacts within boundaries: PSM vs. CM Park Effects on 86-97 % Deforestation, N = 4 in each method -1.99* -9.39** Using All of the Untreated (Naive) -2.21** -1.72** Propensity Score Matching (PSM) -0.85 -2.19** Covariate Matching (CM) Adj. Diff. in Means Difference in Means Strategy