Does Forest Compensation Reflect Community Preferences? Evidence from Contingent Valuation in Zhejiang, China

Sustainable forest governance requires fiscal instruments responsive to community preferences for ecosystem services, yet compensation standards are rarely checked against those preferences. China’s ecological public welfare forest program, which covers 120 million hectares, sets graded provincial compensation rates across internally differentiated communities. Using contingent valuation data from 315 households in Lin’an District, Zhejiang Province (2024), this study compares compensation with community-expressed preferences and asks whether that comparison holds across social groups. The aggregate community willingness to pay (WTP) is CNY 41.07 million per year, with a mean household WTP of CNY 210, and the actual provincial compensation of CNY 41.34 million falls within its confidence interval. Because both quantities carry estimation uncertainty, this interval overlap is not a formal test of equivalence and does not establish that the two are equal. The aggregate correspondence also masks substantial heterogeneity. Income and education generate WTP differentials exceeding 30 percent, and rural residents report valuations 16.6 percent below those of urban residents. This pattern is associated with economic capacity rather than institutional trust or environmental awareness. Lin’an is a most-likely case for such correspondence, since its urban–rural income ratio (1.54:1) lies well below the national average (2.31:1). Preference heterogeneity is therefore plausibly more pronounced elsewhere, although cross-regional replication would be required to confirm this. Graded fiscal instruments for forest resource governance, even where broadly consistent with aggregate preferences, warrant differentiation to sustain community support for conservation across heterogeneous populations.