Geoff Wells

While payments for ecosystem services (PES) schemes are increasingly common, in most cases, their effectiveness has lagged behind initial expectations. A major debate exists around whether performance can be improved by prioritising project design features that align with the theoretical, economistic model of PES, or whether, where necessary, it is more important for projects to depart from this model to build local support and legitimacy. In this study we address this gap by examining how financial incentives, participation in decision making and organisational centralisation have supported land management outcomes across 39 smallholdings participating in carbon agroforestry PES schemes in Mexico and Mozambique. We use interviews, tree growth records and fuzzy set qualitative comparative analysis (QCA) to assess how these three design features, and contextual variables on household wealth and farm-level water availability, have related to the actual level of aboveground biomass (AGB) accumulated on each farm - the main land management objective in such schemes. We then use interviews with farmers and project staff to gain a more in depth understanding of how these design features are linked to land management outcomes. We find that, in our cases, both monetary incentives and good participation in decision making where integral to good outcomes. The level of (de)centralisation was unimportant as long it was perceived as legitimate locally, and accounted for existing social, cultural and historical context. Our findings suggest that attempts to improve the performance of PES schemes by enshrining ‘best practice’ or key design principles must put equal emphasis on economistic design principles and the maintenance of local legitimacy, and should be flexible enough to allow for local processes of institutional bricolage. Given the typical nature of our cases, we argue that our findings provide new insights relevant to the wider PES field.