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Do Tropical Forests Provide Natural Insurance? The Microeconomics of Non-Timber Forest Product Collection in the Brazilian Amazon

  • Subhrendu K. Pattanayak
  • Erin O. Sills

Tropical forests may contribute to the well-being of local people by providing a form of ``natural insurance.’ ’ We draw on microeconomic theory to conceptualize a model relating agricultural risks to collection of non-timber forest products. Forest collection trips are positively correlated with both agricultural shocks and expected agricultural risks in an event-count model of survey data from the Brazilian Amazon. This suggests that households rely on forests to mitigate agricultural risk. Forest product collection may be less important to households with other consumption-smoothing options, but its importance is not restricted to the poorest households.

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Article provided by University of Wisconsin Press in its journal Land Economics.

Volume (Year): 77 (2001)
Issue (Month): 4 ()
Pages: 595-612

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Handle: RePEc:uwp:landec:v:77:y:2001:i:4:p:595-612
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  1. Cavendish, William, 2000. "Empirical Regularities in the Poverty-Environment Relationship of Rural Households: Evidence from Zimbabwe," World Development, Elsevier, vol. 28(11), pages 1979-2003, November.
  2. Byron, Neil & Arnold, Michael, 1999. "What Futures for the People of the Tropical Forests?," World Development, Elsevier, vol. 27(5), pages 789-805, May.
  3. Walker, Robert & Homma, Alfredo Kingo Oyama, 1996. "Land use and land cover dynamics in the Brazilian Amazon: an overview," Ecological Economics, Elsevier, vol. 18(1), pages 67-80, July.
  4. Anjini Kochar, 1999. "Smoothing Consumption by Smoothing Income: Hours-of-Work Responses to Idiosyncratic Agricultural Shocks in Rural India," The Review of Economics and Statistics, MIT Press, vol. 81(1), pages 50-61, February.
  5. Shively, Gerald E., 1997. "Consumption risk, farm characteristics, and soil conservation adoption among low-income farmers in the Philippines," Agricultural Economics of Agricultural Economists, International Association of Agricultural Economists, vol. 17(2-3), December.
  6. Morduch, J., 1995. "Income Smoothing and Consumption Smoothing," Papers 512, Harvard - Institute for International Development.
  7. Reddy, S. R. C. & Chakravarty, S. P., 1999. "Forest Dependence and Income Distribution in a Subsistence Economy: Evidence from India," World Development, Elsevier, vol. 27(7), pages 1141-1149, July.
  8. Gurmu, Shiferaw & Trivedi, Pravin K, 1996. "Excess Zeros in Count Models for Recreational Trips," Journal of Business & Economic Statistics, American Statistical Association, vol. 14(4), pages 469-77, October.
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