Decentralization and Deforestation:the Moderating Role of Polycentric Governance
Abstract: Scholars and practitioners have long debated the merits of decentralization in the area of environmental policy. Here, we present new evidence regarding (a) the effects of decentralization on forest cover change, and (b) the conditions under which decentralization is likely to lead to better outcomes. Drawing on polycentric governance theory we build an argument about the institutional conditions under which decentralization will yield positive outcomes for common pool resource governance. We argue that local governments will be best equipped to address problems of deforestation when they are connected to and supported by other policy actors, including community organizations, national governments, and NGOs. We test this argument using multivariate matching and regression techniques employing a unique dataset on local forest governance and forest condition indicators in Peruvian and Bolivian municipalities. Three results challenge conventional wisdom. First, decentralization has an ambiguous effect on forest cover change. Second, polycentric governance arrangements are no more common in decentralized than in centralized regimes. And third, polycentric governance does have a stronger, positive effect on forest conservation in decentralized settings.
