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Land markets, Property rights, and Deforestation: Insights from Indonesia

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  • Krishna, Vijesh V.
  • Kubitza, Christoph
  • Pascual, Unai
  • Qaim, Matin

Abstract

We examine the emergence of land markets and their effects on forest land appropriation by farm households in Jambi Province, Sumatra, using micro-level data covering land use and land transactions for a period of more than 20years (1992–2015). Based on a theoretical model of land acquisition by a heterogeneous farming population, different hypotheses are developed and empirically tested. Farm households involved in forest land appropriation differ from those involved in land market purchases in terms of migration status and other socioeconomic characteristics. In principle, these differences provide opportunities for market-induced deforestation. However, the appropriated forest land is not extensively traded, which we attribute to the lack of de jure property right protection and the resulting undervaluation in the market. While the de facto property right protection under customary law provides sufficient security within the village community, the sense of external tenure security is low when the land cannot be formally titled. Clearing forests for trading in the land market is, therefore, financially less lucrative for farm households than engaging in own cultivation of plantation crops, such as oil palm and rubber. We conclude that land markets did not have significant effects on deforestation. On the other hand, the emergence of land markets alone has also not been able to deter forest appropriation by local farm households.

Suggested Citation

  • Krishna, Vijesh V. & Kubitza, Christoph & Pascual, Unai & Qaim, Matin, 2017. "Land markets, Property rights, and Deforestation: Insights from Indonesia," World Development, Elsevier, vol. 99(C), pages 335-349.
  • Handle: RePEc:eee:wdevel:v:99:y:2017:i:c:p:335-349
    DOI: 10.1016/j.worlddev.2017.05.018
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    References listed on IDEAS

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    Cited by:

    1. Kubitza, Christoph & Krishna, Vijesh V. & Urban, Kira & Alamsyah, Zulkifli & Qaim, Matin, 2018. "Land Property Rights, Agricultural Intensification, and Deforestation in Indonesia," Ecological Economics, Elsevier, vol. 147(C), pages 312-321.
    2. Vasco Chiteculo & Azadeh Abdollahnejad & Dimitrios Panagiotidis & Peter Surový & Ram P. Sharma, 2018. "Defining Deforestation Patterns Using Satellite Images from 2000 and 2017: Assessment of Forest Management in Miombo Forests—A Case Study of Huambo Province in Angola," Sustainability, MDPI, Open Access Journal, vol. 11(1), pages 1-20, December.
    3. Sanders, Anna J.P. & Ford, Rebecca M. & Mulyani, Lilis & Prasti H., Rut Dini & Larson, Anne M. & Jagau, Yusurum & Keenan, Rodney J., 2019. "Unrelenting games: Multiple negotiations and landscape transformations in the tropical peatlands of Central Kalimantan, Indonesia," World Development, Elsevier, vol. 117(C), pages 196-210.
    4. Chrisendo, D.N. & Krishna, V. & Qaim, M., 2018. "Land-Use Changes, Nutrition, and Gender Roles in Indonesian Farm Households," 2018 Conference, July 28-August 2, 2018, Vancouver, British Columbia 277267, International Association of Agricultural Economists.
    5. Wening Sarwosri, Arieska & Wegmann, Johannes & Mußhoff, Oliver, 2018. "Encouraging rainforest preservation by smallholders: An ex-ante policy evaluation," EFForTS Discussion Paper Series 23, University of Goettingen, Collaborative Research Centre 990 "EFForTS, Ecological and Socioeconomic Functions of Tropical Lowland Rainforest Transformation Systems (Sumatra, Indonesia)".
    6. Erik Lilleskov & Kevin McCullough & Kristell Hergoualc’h & Dennis Castillo Torres & Rodney Chimner & Daniel Murdiyarso & Randy Kolka & Laura Bourgeau-Chavez & John Hribljan & Jhon Aguila Pasquel & Cra, 2019. "Is Indonesian peatland loss a cautionary tale for Peru? A two-country comparison of the magnitude and causes of tropical peatland degradation," Mitigation and Adaptation Strategies for Global Change, Springer, vol. 24(4), pages 591-623, April.
    7. Wening Sarwosri, Arieska & Mußhoff, Oliver, 2019. "Can crop diversification of perennial crop by smallholder farmers explained by risk attitudes and time preferences?," EFForTS Discussion Paper Series 28, University of Goettingen, Collaborative Research Centre 990 "EFForTS, Ecological and Socioeconomic Functions of Tropical Lowland Rainforest Transformation Systems (Sumatra, Indonesia)".
    8. Bou Dib, Jonida & Krishna, Vijesh & Alamsyah, Zulkifli & Qaim, Matin, 2018. "Land-use change and livelihoods of non-farm households: The role of income from employment in oil palm and rubber in rural Indonesia," EFForTS Discussion Paper Series 21, University of Goettingen, Collaborative Research Centre 990 "EFForTS, Ecological and Socioeconomic Functions of Tropical Lowland Rainforest Transformation Systems (Sumatra, Indonesia)".

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