Ethanol Production, Food and Forests
AbstractThis paper investigates the direct and indirect impacts of ethanol production on land use, deforestation and food production. A partial equilibrium model of a national economy with two sectors and two regions, one of which includes a residual forest, is developed. It analyses how an exogenous increase in the ethanol price affects input allocation (land and labor) between sectors (energy crop and food). Three potential effects are identified. First, the standard and well-documented effect of direct land competition between rival uses increases deforestation and decreases food production. Second, an indirect displacement of food production across regions, provoked by a shift in the price of food, increases deforestation and reduces the total output of the food sector. Finally, labor mobility between sectors and regions tends to decrease food production but also deforestation. The overall impact of ethanol production on forest conversion is ambiguous, providing a number of interesting pointers to further, empirical research. --
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Bibliographic InfoPaper provided by Verein für Socialpolitik, Research Committee Development Economics in its series Proceedings of the German Development Economics Conference, Hannover 2010 with number 21.
Date of creation: 2010
Date of revision:
Ethanol; Deforestation; Indirect impacts; Land use; Migration;
Other versions of this item:
- Saraly Andrade de Sa & Charles Palmer & Stefanie Engel, 2010. "Ethanol Production, Food and Forests," Environmental Economy and Policy Research Working Papers 48.2010, University of Cambridge, Department of Land Economics, revised 2010.
- Q11 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Aggregate Supply and Demand Analysis; Prices
- Q24 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Land
- Q42 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Alternative Energy Sources
This paper has been announced in the following NEP Reports:
- NEP-AGR-2010-09-25 (Agricultural Economics)
- NEP-ALL-2010-09-25 (All new papers)
- NEP-ENE-2010-09-25 (Energy Economics)
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