Liangshan Bank, A hybrid model of payment for ecosystem services governance in rural development: The case of Baofu, China

This paper focuses on the operation of Value Realisation of Ecosystem Products and Services based on empirical research of the Liangshan Bank model in Baofu, China. It examines a new hybrid approach to ecosystem services governance to address the problems of idle rural land due to urbanisation. The study finds that operating this new model enhances governance efficiency by coordinating different institutional policies and reducing uncertainties and transaction costs through a mechanism which is guided by the government, dominated by the market and participated by communities. The model can increase rural villagers' income by using idle rural land as a market asset. The research outcomes show that the Liangshan Bank model, which provides a transparent trading platform for villagers and investors to effectively use rural land, protect the environment, and alleviate poverty, can exemplify other rural areas in China and developing countries. The paper highlights the academic debate on payment models for ecosystem services. It also offers an alternative model for governments and communities to achieve environmental protection, effective land use, and poverty alleviation in rural areas