Abstract
Environmental markets that consider trade-offs of benefits flow and conservation burdens among economic units contributes to the sustainability of natural resource capital. Despite the benefits of environmental markets, the existence of bureaucratic processes in ecosystem financing such as Payment for Environmental Services creates a perverse market structure, which impedes the efforts of internalising environmental costs through distributional effects of conservation rewards and burdens among economic units. Therefore, this paper explores the applicability of using cryptographic protocols in blockchain technologies as a paradigm shift in financing conservation stewardship at the micro-level. Secondary data from documented literature was used as the source of information in this study. Systematic searches on different websites were used to identify relevant scientific papers, journals, abstracts, reports and presentations that resonated with the theme of this study. To gain hands-on information regarding blockchain technologies, the snowballing research design was used to identify individuals with technological know-how on the functionality and blockchain operability. Blockchain technologies can be merited because it portrays a high degree of transparency and trustworthiness among economic units when used in environmental markets. Therefore, designing a robust cryptographic protocol that facilitates efficient trade-offs of conservation rewards and burdens in present environmental market creates incentives for the resource conservation and protection.
Highlights
The environment in its natural state provides society with ecological attributes that are crucial in supporting human life on earth
To address the research’s objective, we reviewed various literature that resonates on financing services, on the applicability and operability of blockchain technologies in easing the payment process systematic searches on different websites, i.e., the ISI Web of Knowledge (WoK), which is among the world’s largest databases of scientific papers, were used to identify relevant scientific papers, abstracts, journals, reports and presentation
The payment process is mired by opaque transactions due to proxies that are involved in the financial transactions
Summary
The environment in its natural state provides society with ecological attributes that are crucial in supporting human life on earth. Despite its immense economic contribution, studies by Kiptum et al (2012) and Kelemen et al (2016) found natural environments to be facing the pressure of degradation from human activities, which result in disruption of ecosystem functions. Lack of transparency and accountability, embezzlement of funds, and existences of bureaucracies in management of community projects by resources managers could discourages resources providers to engage into conservation stewardship. This creates a complex puzzle that needs efforts that could incorporate resources supplier in decision making as a way of enhancing sustainability of forests and its resources. Comparison of expressed willingness to contribute for community conservation projects by rural households was made between two scenarios were existences and/or inexistence of democratically elected representative of rural community in decision making for the
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