Fight Fire With Finance: A Randomized Field Experiment To Curtail Land-Clearing Fire In Indonesia

This paper presents one of the first randomized evaluations of collective pay-for-performance payments for ecosystem services. We test whether community-level fiscal incentives can curtail the use of land-clearing fire, a major source of emissions and negative health externalities. The program was implemented over the 2018 fire season in Indonesia with three parts: (a) awareness raising and training on fire prevention, (b) a small capital grant to mobilize fire fighting resources, and (c) the promise of a large conditional cash transfer at the end of the year if the village does not have fire, which we monitor by satellite. While program villages increase fire prevention efforts, we find no evidence of any large or statistically significant differences in fire outcomes. Our results appear to be driven by a combination of the payment not being large enough and a failureof collective action, and offer a cautionary tale on the importance of measuring additionality when evaluating payments for environmental services and other conservation programs.