Jean-Louis ARCAND () Patrick GUILLAUMONT () (Centre d'Etudes et de Recherches sur le Développement International) Sylviane GUILLAUMONT JEANNENEY () (Centre d'Etudes et de Recherches sur le Développement International)
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Based on an annual sample of 122 countries over the 1963-1994 period, this paper shows that real exchange rate depreciation reduces deforestation in relatively developed countries (with GDP per capita greater than $900) whereas it has the opposite effect in poor countries. A possible explanation for this result lies in the hypothesis that variations in the real exchange rate are perceived as being transitory in LDCs, given its high degree of instability in these countries. Our empirical results suggests that macroeconomic policy is a potentially important determinant of environmental outcomes.
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Paper provided by CERDI in its series Working Papers with number
200213.
Length: 20 Date of creation: 2002 Date of revision: Handle: RePEc:cdi:wpaper:178
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