Climate Change Mitigation in Ethiopia: To What Extent Do Carbon Sequestration Projects Put Impact on Smallholder Farm Households’ Income?

Abstract

Environment friendly programslike carbon sequestration can play a positive role in enhancing household income for the resource scarce smallholder farmers. This paper sets out to assess whether a programme of climate-change mitigation through carbon sequestration initiated in Wolaita Zone (Ethiopia) is incentive compatible for smallholder farm households. It uses a quasi-experimental analytical method to analyze cross sectional data gathered from 199 randomly selected households to estimate its effect on per capita income of the project beneficiaries. Propensity score matching estimatessuggested thatmembership in the carbon sequestration projectput significant impact on the annual income of the participants, as compared to the non-participants. The article concludes by arguing for the promotion of such platforms of Clean Development Mechanism (CDM).

Keywords: carbon sequestration, climate change, income, mitigation