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Contagious development: Neighbor interactions in deforestation

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  • Robalino, Juan A.
  • Pfaff, Alexander

Abstract

We estimate neighbor interactions in deforestation in Costa Rica. To address simultaneity and the presence of spatially correlated unobservables, we measure for neighbors' deforestation using the slopes of neighbors' and neighbors' neighbors' parcels. We find that neighboring deforestation significantly raises the probability of deforestation. Policies for agricultural development or forest conservation in one area will affect deforestation rates in non-targeted neighboring areas. Correct estimation of the interaction reverses the naive estimate's prediction of multiple equilibria.

Suggested Citation

  • Robalino, Juan A. & Pfaff, Alexander, 2012. "Contagious development: Neighbor interactions in deforestation," Journal of Development Economics, Elsevier, vol. 97(2), pages 427-436.
  • Handle: RePEc:eee:deveco:v:97:y:2012:i:2:p:427-436
    DOI: 10.1016/j.jdeveco.2011.06.003
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    Cited by:

    1. Jeffrey R. Vincent, 2016. "Impact Evaluation of Forest Conservation Programs: Benefit-Cost Analysis, Without the Economics," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 63(2), pages 395-408, February.
    2. John Lynham, 2017. "Identifying Peer Effects Using Gold Rushers," Land Economics, University of Wisconsin Press, vol. 93(3), pages 527-548.
    3. Sauquet, Alexandre & Marchand, Sébastien & Féres, José Gustavo, 2014. "Protected areas, local governments, and strategic interactions: The case of the ICMS-Ecológico in the Brazilian state of Paraná," Ecological Economics, Elsevier, vol. 107(C), pages 249-258.
    4. Pfeiffer, Lisa & Lin, C.-Y. Cynthia, 2012. "Groundwater pumping and spatial externalities in agriculture," Journal of Environmental Economics and Management, Elsevier, vol. 64(1), pages 16-30.
    5. Vargas, Andrés & Lo, Alex Y. & Rohde, Nicholas & Howes, Michael, 2016. "Background inequality and differential participation in deliberative valuation: Lessons from small-group discussions on forest conservation in Colombia," Ecological Economics, Elsevier, vol. 129(C), pages 104-111.
    6. Delacote, Philippe & Robinson, Elizabeth J.Z. & Roussel, Sébastien, 2016. "Deforestation, leakage and avoided deforestation policies: A spatial analysis," Resource and Energy Economics, Elsevier, vol. 45(C), pages 192-210.
    7. Kassie, Menale & Yesuf, Mahmud & Köhlin, Gunnar, 2008. "The Role of Production Risk in Sustainable Land-Management Technology Adoption in the Ethiopian Highlands," Discussion Papers dp-08-15-efd, Resources For the Future.
    8. repec:zbw:rwirep:0242 is not listed on IDEAS
    9. Busch, Christopher B. & Vance, Colin, 2011. "The Diffusion of Cattle Ranching and Deforestation – Prospects for a Hollow Frontier in Mexico's Yucatán," Ruhr Economic Papers 242, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
    10. Luiza Andrade & André Luis Squarize Chagas, 2016. "Spillover effects of blacklisting policy in the Brazilian Amazon," Working Papers, Department of Economics 2016_32, University of São Paulo (FEA-USP).
    11. Katharine Sims, 2014. "Do Protected Areas Reduce Forest Fragmentation? A Microlandscapes Approach," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 58(2), pages 303-333, June.
    12. Pfaff, Alexander & Robalino, Juan & Lima, Eirivelthon & Sandoval, Catalina & Herrera, Luis Diego, 2014. "Governance, Location and Avoided Deforestation from Protected Areas: Greater Restrictions Can Have Lower Impact, Due to Differences in Location," World Development, Elsevier, vol. 55(C), pages 7-20.
    13. repec:oup:jecgeo:v:18:y:2018:i:1:p:87-110. is not listed on IDEAS
    14. Huixia Zhao & Emi Uchida & Xiangzheng Deng & Scott Rozelle, 2011. "Do Trees Grow with the Economy? A Spatial Analysis of the Determinants of Forest Cover Change in Sichuan, China," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 50(1), pages 61-82, September.
    15. Jorge Hargrave & Krisztina Kis-Katos, 2013. "Economic Causes of Deforestation in the Brazilian Amazon: A Panel Data Analysis for the 2000s," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 54(4), pages 471-494, April.
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    19. Christopher B. Busch & Colin Vance, 2011. "The Diffusion of Cattle Ranching and Deforestation: Prospects for a Hollow Frontier in Mexico’s Yucatán," Land Economics, University of Wisconsin Press, vol. 87(4), pages 682-698.
    20. Colin Vance & Christopher B. Busch, 2011. "The Diffusion of Cattle Ranching and Deforestation – Prospects for a Hollow Frontier in Mexico’s Yucatán," Ruhr Economic Papers 0242, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.
    21. Robalino, Juan & Pfaff, Alexander & Sanchez-Azofefia, G. Arturo & Alpizar, Francisco & Leon, Carlos & Rodriguez, Carlos Manuel, 2008. "Deforestation Impacts of Environmental Services Payments: Costa Rica’s PSA Program 2000–2005," Discussion Papers dp-08-24-efd, Resources For the Future.
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    More about this item

    Keywords

    Instrumental variable; Neighbors' interactions; Local interactions; Social interactions; Land use patterns; Environmental policies;

    JEL classification:

    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • Q24 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Land

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