Influence of payment modes on farmers’ contribution to climate change adaptation: understanding differences using a choice experiment in Nepal

Abstract

Adaptation has become a key priority in dealing with climate change issues. However, successful implementation of climate change adaptation entails substantial financial investment. This study examines differences in Nepalese farming households’ willingness to contribute to the implementation of adaptation programs across monetary and non-monetary modes of payments. To this end, we undertake discrete choice experiments with monetary payment and labor contributions as the payment vehicles. We find that farmers are interested in participating in and financially supporting the implementation of climate change adaptation initiatives that increase the availability of climate-adaptive crop varieties, improve soil quality, expand irrigation and build farmers’ capacity in terms of climate-adaptive farming. Factors influencing farmers’ participation in adaptation programs include age, income, access to extension services, size of land holdings, number of farm parcels, climate change perception and climate change experience. Furthermore, the findings reveal significant heterogeneity in the farmers’ preferences across three agro-ecological regions in Nepal. Our findings also strengthen the methodological validity of the results of the choice experiment, which indicated that farmers are willing to pay significantly more when asked to make a payment in terms of a labor contribution compared to a monetary payment for the implementation of adaptation programs. Overall, the findings of this study justify the relevance of implementing agricultural adaptation programs in Nepal.