Measuring the incremental impact of Payments for Watershed Services on water quality in a transboundary river basin in China

Qingmin Zeng, Roy Brouwer, Yurong Wang and Ligen Chen

Ecosystem Services, 2021, vol. 51, issue C

Abstract: This study assesses the incremental impact of the first transboundary Payments for Watershed Services (PWS) scheme on water quality in China. Due to the absence of a control situation without the PWS scheme, the synthetic control method (SCM) is applied to construct a counterfactual for the prefecture city Huangshan in Eastern China where the PWS is implemented based on the socio-economic characteristics of more than 75 other prefecture cities. The creation of such a counterfactual is crucial in view of the declining trend in water pollution observed before implementation of the PWS scheme. Despite this downward trend in water pollution, an additional effect of the PWS scheme is observed. This result is not obtained when using any of the other prefecture cities as a placebo to test the robustness of this outcome. The application of the SCM in this study is a promising new avenue for the evaluation of PWS schemes elsewhere where similar control conditions are lacking. However, as we show, its applicability depends crucially on the availability of relevant water quality monitoring data.

Keywords: Payments for Watershed Services; Water pollution; Incremental impact; Synthetic control method; China (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecoser:v:51:y:2021:i:c:s2212041621001133

DOI: 10.1016/j.ecoser.2021.101355

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