Study On Afforestation Subsidy In Loess Plateau

It is significant for the forest conservation and management worldwide to implement thesubsidy system, and which is one of most important policy approaches for supporting forestdevelopment in many countries, because it can reduce the forest management risk, raise theforest investment level and improve the ecological environment. In the existing literatures, thesubsidy standards researches involves not only region difference, i.e. the subsidy in tropicalrain forest, temperate forest, or grassland, but also the land site difference, such as the subsidyfor timber forest, shelterbelts, commercial forest, or ecological forest. Moreover, the existingliteratures got different conclusions eventhough they used the same methods in the sameregiion, even some contradictory and conflicting conclusions appeared in these researches. Inaddition, one obvious common of these existing literatures is they all ignore the forest specieswill significantly influence the afforestation subsidy. What’s more, in practice, the subsidystandard calculated unscientifically in many countries have led to the inefficiency and highexcution cost of policy implementation, and finally led to the unsustainable of forest program.Therefore, it worth to study the rational subsidy standard, with satisfied both the subsidypayer (government) and subsidy accepters (forest farmers), and then achieve the higheffciency and low excution cost of forest program. In China, all forest subsidy system weredesigned by government, and then gradually revised the subsidy in the process of forestcompensation programs pilot. It is inefficient to reach the optimal rational subsidy of forestprograms so slowly and gradually. This paper will introduce the Voluntary EnvironmentalApproaches into determining the afforestation subsidy in order to improve the effectivenessand efficience of subsidy system, and then determine the rational subsidy standardconsidering both the willingness and benefits of both government and households or farmers.Therefore, the main clue of this paper is described as following: firstly, it mainly focuses onthe subsidy standard that forest farmers can accept, which is got through the method ofOpportunity Cost and Willingness to Accept using the households data. Secondly, the subsidystandard that the government want to pay considering the interiorization of the carbonsequestration benefits. Then this paper constructs the government-forest farmers negotiationmodel under the Voluntary Environmental Approach, and finally gets the rational and optimal afforestation subsidy through the empirical analysis of case in Loess Plateau.Given above research clue, this paper will analysis the optimal and rational subsidy onafforestation which can realize the carbon sequestration benefits in marginal farm-land, usingthe opportunity cost method, willingness to accept, the interiorization of the carbonsequestration benefits, and the voluntary environmental approach, and the main aim of thispaper is to design how to determine the optimal and rational afforestation subsidy, which canimprove the research on the forest subsidy policy, even give some new ideas to the researchon the forest ecological compensation.From the view of opportunity cost and willingness to acceept, this paper firstly analysisthe afforestation subsidy based the benefits of forest farmers, and treat this subsidy as thelowest level of the optimal subsidy system. Standing on the position of forest farmers, theopportunity cost of establish forest is the most benefits from either farmland use, transferingthe farmland to pastureland, or land abandonment. Therefore, the government must payfarmers subsidy that at least making the planting trees on the farmland bring the most benefits,if the they want farmers to establish forest on the farmland. The subsidy calculated throughthis clue is the objective subsidy the farmers can accept. In order to understand the subjectivesubsidy in the farmers’ mind, this paper also design the questionnaire to inquire thewillingness to accept, and get the subjective sugsidy for farmers can accept. Finally, this papercompare the results from the opportunity cost method and willingness to accept method, andthen try to get the subsidy from the farmers’ perspcetive. Because the farmers are inclined toover estimate their willingness to accept, it is rational to determine the subsidy standardmainly based on opportunity cost. Through the empirical analysis, during the private rotationage, the subsidy claim of farmers is2405yuan/ha, while the NPV of farmers’ subsidy claim is39226.16yuan if the government want to postpone the private rotation age to the socialoptimal rotation age.Then this paper analysis subsidy standard from perspective of government with theinteriorization of carbon sequestration benefits, and regard this subsidy as the high level thegovernment want to pay. With the growth information of Hippophae rhamnoides L. from theexisting researches, this paper value the carbon sequestrated by from forests, and then regardthis valuation as the subsidy the government willing to pay. Through this process, the NPV ofthe subsidy government wants to pay is39591.40yuan (2174yuan/ha/year in total34years),which is the highest limit of afforestation subsidy the government wants to pay.Finally, it is the optimal afforestation subsidy determined using the voluntaryenvironmental approaches based on the afforestation subsidy calculated from the perspectiveof forest farmers and government respectively. It is an innovation of this paper to introduce the voluntary environmental approaches in to the afforestation subsidy system in order todetermine the optimal subsidy. The subsidy under the voluntary environmental approachesfully reflect the claims of both forest farmers and government. During the social optimalrotation age, the NPV of subsidy claims of farmers is39226.16yuan, while the NPV ofgovernment subsidy cliams is39591.40yuan. The voluntary environmental agreements canreach because the government cliam is higher than the farmers’ cliam. Given the symmetricalinformation context, the forest farmers and government negotiate voluntarily to determine theoptimal afforest subsidy with considering their claims. The optimal afforestation subsidyusing the voluntary environmental approaches is39408.78yuan. What’s more the subsidy canbe supplied as follows. The government should pay farmers2405yuan/ha/year for the first21years, and from22nd to34th year, it should pay farmers1294yuan/ha/year. Given thehypothesis and analysis framework established in this paper, this subsidy standard can reachthe policy aims of the afforestation program.It is a innovation that introducing the VEAs into the afforestation program, which offersa new way to determining the afforestation subsidy. This is the theoretical value of thisresearch. Moreover, this research consider the subsidy claims of both government and forestfarmers, especially the claims of latter, who are main body of afforestation program, therefore,this research has improtant practical significance. It is not to negelect that the voluntaryenvironmental approaches have limitation in application, although it is the promisingapproach in the environment regulation. Therefore, before the implement of afforestationprogram, it is necessary to propagandize the afforestation policy and the ecological servicesprovided by forests, and should carefully determined the afforestation subsidy in order torealize the ecological objectives of afforestation program.