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Assessing policies to mitigate abandonment of shade-grown coffee production in forest systems amid low and uncertain prices

Published online by Cambridge University Press:  21 December 2020

Heidi J. Albers Open the ORCID record for Heidi J. Albers [Opens in a new window] ,
Stephanie Brockmann  and
Beatriz Ávalos-Sartorio
Heidi J. Albers*
Affiliation:
Department of Economics, University of Wyoming, Laramie, WY, USA
Stephanie Brockmann
Affiliation:
Department of Economics, University of New Hampshire, Durham, NH, USA
Beatriz Ávalos-Sartorio
Affiliation:
Rainforest Alliance, Cabo San Lucas, Baja California Sur, Mexico
*
*Corresponding author. E-mail: jo.albers@uwyo.edu
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Abstract

Low and highly variable prices plague the coffee market, generating concerns that coffee farmers producing in shade systems under natural forests, as in biodiversity hotspot Oaxaca, Mexico, will abandon production and contribute to deforestation and reduced ecosystem services. Using stakeholder information, we build a setting-informed model to analyze farmers' decisions to abandon shade-grown coffee production and their reactions to policy to reduce abandonment. Exploring price premiums for bird-friendly certified coffee, payments for ecosystem services, and price floors as policies, we find that once a farmer is on the path toward abandonment, it is difficult to reverse. However, implementing policies early that are low cost to farmers – price floors and no-cost certification programs – can stem abandonment. Considering the abandonment that policy avoids per dollar spent, price floors are the most cost-effective policy, yet governments prefer certification programs that push costs onto international coffee consumers who pay the price premium.

Keywords

biodiversitycertificationdeforestationfarmer decisionsgreen marketspolicy analysisshade-grown coffee

JEL classification

O13: Agriculture • Natural Resources • Energy • Environment • Other Primary Products Q57: Ecological Economics: Ecosystem Services • Biodiversity Conservation • Bioeconomics • Industrial Ecology Q56: Environment and Development • Environment and Trade • Sustainability • Environmental Accounts and Accounting • Environmental Equity • Population Growth Q15: Land Ownership and Tenure • Land Reform • Land Use • Irrigation • Agriculture and Environment Q58: Government Policy C60: General
Type
Research Article
Information
Environment and Development Economics , Volume 26 , Issue 4 , August 2021 , pp. 403 - 428
Copyright
Copyright © The Author(s), 2020. Published by Cambridge University Press

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