Farmers’ Income Changes Oriented Toward Horizontal Ecological Compensation Policies

Menglin Huang and Taixiang Wang

SAGE Open, 2025, vol. 15, issue 3, 21582440251363748

Abstract: Promoting income growth for farmers in ecological protection areas is a critical prerequisite for the effective implementation and widespread adoption of the ecological compensation mechanism. The study uses the Xin’an River as a case, empirically analyzing the impact of horizontal ecological compensation policies on farmers’ income in the basin, based on panel data from 89 counties in Anhui and Zhejiang provinces between 2007 and 2021, employing the PSM-DID model. We found that (i) overall, the policy increased the income of farmers in the watershed by an average of 16.0%. (ii) In terms of spatial dimension, the policy led to a 24.7% increase in farmers’ income in midstream, significantly higher than in the upstream(11.6%) and downstream (15.9%) regions. (iii) In the temporal context, there was no significant difference in the impact of the three rounds of policies on farmers’ income. This study provides a new perspective in the spatio-temporal research of cross-provincial ecological compensation policies, offers empirical support for evaluating the benefits of the Xin’an River ecological compensation policies to farmers, and serves as an important reference for further optimization of the ecological compensation policy system.

Keywords: ecological compensation; farmers’ income; spatiotemporal heterogeneity (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:sae:sagope:v:15:y:2025:i:3:p:21582440251363748

DOI: 10.1177/21582440251363748

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