Trees are important because they absorb lots of carbon dioxide, which is a by-product of fossil fuel burning and is the primary of driver of global warming.
The analysis of a system called "Payments for Ecosystems" in Uganda showed its benefits to the environment were 2.4 times as large as the program costs, said the study in the journal Science.
"The payments changed people's behavior and prompted them to conserve," said lead author Seema Jayachandran, associate professor of economics in the Weinberg College of Arts and Sciences at Northwestern University.
"And we didn't find any evidence that they simply shifted their tree-cutting elsewhere."
The two-year study in western Uganda examined the impact of offering landowners 70,000 Ugandan shillings ($28 in 2012 U.S. dollars) per year for each hectare (2.5 acres) of forest in which they left trees unperturbed.
Sixty villages were randomly selected to receive incentives, and 61 were not offered any cash to save the trees.
Satellite data was analyzed to measure tree cover, and forest monitors conducted spot checks on enrollees' land to hunt for any sign of recent tree-clearing.
"In the villages without the program, nine percent of the tree cover that was in place at the start of the study was gone by the end of it, two years later," said Jayachandran.
"In the villages with the PES program, there was four to five percent tree loss. In other words, there was still deforestation, but much less of it."
