The livelihood impacts of transnational aid for climate change mitigation: Evidence from Ghana

While multilateral agencies have spent hundreds of millions of dollars in the forestry sector to curb deforestation, mitigate climate change, and improve local livelihoods, there is a lack of rigorous empirical analyses demonstrating past investments' effectiveness in improving livelihoods. We investigate such programs' effectiveness in changing livelihoods by estimating the Forest Investment Program (FIP)'s short-term impacts in Ghana. We do not find significant changes in income, expenditure, and food security of households in FIP communities compared with non-FIP communities post-FIP. However, households in FIP communities with increased monitoring and enforcement activities decreased the harvest of forest products, which caused forest-dependent households to allocate their labor toward own farm production. These results suggest mitigation programs relying on increased monitoring and enforcement should also support practical ways to offset negative livelihood impacts from the decreased harvest of forest products.