A Legal Butterfly Effect: Unexpected Twists and Turns of the Law in Costa Rica’s Payment for Ecosystem Services Program

Costa Rica’s Payment for Ecosystem Services program (PES) is one of the most studied exercises of its kind but closer examination of the program’s legal framework and governance is still lacking. The PES did not occur on a vacuum; laws and policies outside the boundaries of the PES’ regulations shape the way it evolved and functions. The supervisory checks and balances of the forestry regency system, the public funds laws that reduced the program’s flexibility, and the administrative simplification process across the Costa Rican government are all examples of policies outside the PES that strongly influence its functioning. Foreign policies also shaped the PES. For example, the World Bank-sponsored structural changes of the Costa Rican economy during the 1980’s helped shift the rationale from forest subsidies to payments for ecosystem services. In addition, a closer look at the PES on the ground provides interesting opportunities to reflect on the effects of this legal framework. For example, the way violations to forest laws occur and are dealt with by judges and PES officials most likely had an effect on the Costa Rican forest cover, which is missed in studies focused on the additionality of the program. Ultimately, however, people implement the PES and this paper suggests an interesting dynamic between two types of bureaucrats at the program, the ‘technicians’ and the ‘lawyers’. The ‘lawyers’ seem to have displaced the ‘technicians’ in a process of ‘rendering legal’ nature, which has conflicting implications for the PES effectiveness. All these dynamics may suggest a legal ‘butterfly effect’ that policy-makers ought to be aware of when designing and implementing environmental institutions and mechanisms.