Selective carbon credits: Market preferences and ecosystem restoration in Senegal
Abstract
The voluntary carbon market is presented as a solution to fund land and ecosystem restoration in developing economies. While the empirical literature has focused on assessing its ecological effectiveness, limited attention has been given to how this market interacts with other funding streams within national contexts. Delineating the types of projects that the voluntary carbon market can effectively fund is essential for designing a coherent and integrated funding strategy at the national level. This paper investigates the contribution of the voluntary carbon market to ecological restoration projects in Senegal. Grounded in transaction costs and organizational economics and drawing on a novel dataset of restoration projects from 2007 to 2023, we identify a pattern in which the voluntary carbon market focuses on significantly less context-specific and more certain restoration protocols. The uncertainty of ecological outcomes and the specificity of natural capital explain the recourse to the market, and the market shapes specificity by attempting to standardize assets and facilitate transactions. This impacts restoration protocols, ecosystem targeted and local benefits. Our analysis offers a detailed understanding of how market preferences influence funding allocation and project implementation. Our findings underscore the need to integrate market-based funding with other mechanisms to address land degradation.
Figure

Figure 1 : Spatial distribution of carbon and non-carbon funded restoration projects in Senegal (2007–2023).
Conclusion
The case study of Senegal highlights the role of the voluntary carbon market in supporting ecological restoration projects, particularly mangrove restoration. However, our findings also reveal limitations and challenges associated with this funding mechanism. The market’s preference for projects with predictable outcomes and lower risks results in a geographical concentration of carbon market projects and excludes more complex and uncertain restoration initiatives from this kind of funding. This underscores the need for a more diversified approach to address the broader ecological restoration needs. Integrating ecological features into the TC framework provides valuable insights into how biophysical conditions influence the funding source. Our research suggests that simply increasing the price of carbon may not be sufficient to address the challenges associated with more complex and uncertain restoration projects. Beyond funding gap, our research is a call to explicitly address financial coordination gaps and potential solutions as blended models and temporal sequencing.
Référence
Morgane Gonon, Rémi Prudhomme, Marieme Ba, Penda Diop, Tamsir Mbaye, Harold Levrel, Adrien Comte. Selective carbon credits: Market preferences and ecosystem restoration in Senegal. Ecological Economics, Volume 235 (2025). https://doi.org/10.1016/j.ecolecon.2025.108626.









