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Agricultural Displacement and Deforestation Leakage in the Brazilian Legal Amazon

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  • Fanny Moffette
  • Holly K. Gibbs

Abstract

Does environmental policy aiming to reduce deforestation induce displacement of existing agricultural activities? To shed light on this question, we exploit a difference-in-differences strategy with a distance-based treatment to examine whether two policies in the Brazilian Amazon, the Soy Moratorium and the Zero-Deforestation Cattle Agreements, have displaced production or deforestation into neighboring regions. Our results show evidence that the Soy Moratorium induced soy spillovers onto previously cleared land—mainly pasture—in the less regulated ecosystem. The spillovers from the Cattle Agreements, three years after the Soy Moratorium, resulted in increased deforestation.

Suggested Citation

  • Fanny Moffette & Holly K. Gibbs, 2021. "Agricultural Displacement and Deforestation Leakage in the Brazilian Legal Amazon," Land Economics, University of Wisconsin Press, vol. 97(1), pages 155-179.
    • Handle: RePEc:uwp:landec:v:97:y:2021:i:1:p:155-179
    Note: DOI: 10.3368/wple.97.1.040219-0045R
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    Cited by:

    1. Filewod, Ben & McCarney, Geoff, 2023. "Avoiding leakage from nature-based offsets by design," LSE Research Online Documents on Economics 117927, London School of Economics and Political Science, LSE Library.
    2. Nelson Villoria & Rachael Garrett & Florian Gollnow & Kimberly Carlson, 2022. "Leakage does not fully offset soy supply-chain efforts to reduce deforestation in Brazil," Nature Communications, Nature, vol. 13(1), pages 1-10, December.
    3. Filewod, Ben & McCarney, Geoff, 2023. "Avoiding leakage from nature-based offsets by design," LSE Research Online Documents on Economics 117928, London School of Economics and Political Science, LSE Library.
    4. Moffette, Fanny & Skidmore, Marin & Gibbs, Holly K., 2021. "Environmental policies that shape productivity: Evidence from cattle ranching in the Amazon," Journal of Environmental Economics and Management, Elsevier, vol. 109(C).

    More about this item

    JEL classification:

    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy; Animal Welfare Policy
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products

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