Who benefits from watershed ecological compensation: Understanding the impact on farm households in vulnerable areas from a lifecycle perspective

Watersheds, as complex socio-ecological systems, are among the most sensitive and vulnerable regions to human-environment interactions. While the ecological benefits of the watershed ecological compensation (WEC) policy have been widely recognized, limited attention has been paid to how farm households at different family life cycle (FLC) stages respond heterogeneously to WEC. Given the increasing trend of unequal livelihood vulnerability within watersheds, an urgent need exists for further exploration of how WEC policies impact the livelihood of vulnerable farm households. Drawing on survey data from 869 farm households, this study investigates the pathways through which WEC affects the sustainability of household livelihoods. The results show that WEC significantly enhances households’ livelihood capital, while labor allocation serves as an important mediating variable linking livelihood capital to household income. Further analysis reveals that the pathway “WEC→livelihood capital→labor allocation→household income” plays a pivotal role in promoting livelihood transitions. Furthermore, the FLC plays a moderating role in the relationship between WEC and households’ livelihood capital, with particularly pronounced effects along the pathway of labor resource reallocation. These findings reveal the behavioral mechanisms underlying farm households’ responses to WEC policies and offer empirical insights for advancing synergies between ecological conservation and sustainable rural livelihoods in transboundary watersheds.