The enduring effects of China’s Payments for Ecosystem Services: Short- and long-term industrial transformations

Wen Wang and Qi Pan

Journal of Environmental Economics and Management, 2025, vol. 130, issue C

Abstract: Payments for Ecosystem Services (PES) policies are crucial for forest conservation and restoration. While initially restricting the availability of land for primary agricultural activities, these policies can catalyze value-added transformations in the agricultural sectors through the redistribution of resources and labor. Using county-level business registration data from 1998 to 2015, this study examines the agricultural transitions and industrial shifts resulting from China’s Sloping Land Conversion Program (SLCP). Employing a staggered difference-in-differences approach, we observed an annual increase of 24.37 agricultural enterprises and a 2.55% annual rise in agricultural industries within SLCP counties. Further analysis indicates that labor mobility influences the changes in the agro-industries. Over the long term, the availability of transportation and internet services fosters agro-industrial growth; however, in the short term, these factors impede immediate growth by accelerating labor out-migration.

Keywords: Payment for Ecosystem Service; Agro-industry; Land conversion; Agricultural transformation (search for similar items in EconPapers)
JEL-codes: Q12 Q56 Q58 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jeeman:v:130:y:2025:i:c:s0095069625000038

DOI: 10.1016/j.jeem.2025.103119

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