| Zoning public welfare forest is a major initiative which is on the basis of China’s ecological strategy, in order to play the ecological benefits of forests, and protect the forest assets. With the implementation of collective forest right system reform, farmers have become the owners or operators of public welfare forest. Due to the special nature of public welfare forest, famers have put labor in public welfare forest, but couldn’t get the benefits from sale of timber, so it is necessary for Government to compensate farmers who operate public welfare forest. Since China had carried out the system of forest ecological benefit compensation in2004, we have made great development on forest construction, and the forest compensation system has gradually been implemented. Forest compensation system related to the vital interests of millions of farmers, related to the protection and development of China’s public welfare forest, related to the safety of long-term stability of forest ecosystems in China. It is an important foundation for the sustainable development of regional economy and society, is an important guarantee for harmony and stability in forest areas.This paper takes the knowledge of economics and management as theoretical basis, is on the base of relevant academics’existing literature, first of all, described the basic theory of forest compensation, analyzed the substance of the compensation. Secondly, introduced the concepts which are related to forest compensation. Then described China’s current policy about forest compensation, analyzed the achievements and shortcomings of the current compensation policies. Then, gave a comprehensive study on China’s forest compensation mechanism, which include government compensation mechanism market-incentive and capacity support mechanism.. Next, took a case study of Wulong county and Yulong county, analyzed the input and output of farmers’ operating public welfare forest, proposed that use the method of measuring inputs and outputs and willingness to accept to estimates reasonable compensation standard, and established a suitable and viable forest compensation mechanism for natural forest protection project (NFPP) area.This paper is of the opinion that, with positive externalities of farmers’ forest Construction business activities, the essence of the forest compensation is internalize the externality through the establishment and implementation of government-led forest compensation mechanism, so that to realize optimizing resource allocation and improve the efficiency of economic operation. China’s forest compensation mechanism in NFPP area should include at least the following levels:the subject of public welfare forest compensation is central government, the provincial government in zoning area and in middle and lower reaches of river basin where benefit from the public welfare forest may also be considered to be included. The main objects of compensation are the owner or operator of public welfare forest, that is, farmers. Grass-roots government in zoning area can be incorporated into the scope of the compensation objects in the future. Compensation standards could be measured from two aspects of opportunity cost and input-output. According to the economic development, the standard of compensation should be dynamic. Compensation period should be long-term. The main source of compensation funds is government expenditure. Properly seek the sources of tax reform and bond loans. Make the compensation mechanism to gradually tilt to market-incentive and capacity support mechanism, actively explore and adopt market-oriented way. Government needs to form targeted market-oriented policy and measures, establish and improve the supporting facilities, and guide the famers. Coordinate the conflicts in NFPP area, so as to develop the NFPP, the reform of collective forest right system, and the forest classification management coordinately. |
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