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Economic Growth and Liquidation of Natural Capital: The Case of Forest Clearance


  • Robin Naidoo


The importance of natural capital to economic systems is increasingly recognized. Previous empirical models of economic growth rates, however, have emphasized accumulation of physical and human capital. This paper shows that the economic growth of over 70 countries has been positively affected by liquidation of one aspect of natural capital, forests, while controlling for factors typically associated with national growth rates. The positive association was robust to additions of various covariates, such as forest exports, level of economic development, agricultural area, and geographical position. These results suggest that conversion of forests has partially fuelled the economic expansion of countries

Suggested Citation

  • Robin Naidoo, 2004. "Economic Growth and Liquidation of Natural Capital: The Case of Forest Clearance," Land Economics, University of Wisconsin Press, vol. 80(2), pages 194-208.
  • Handle: RePEc:uwp:landec:v:80:y:2004:i:2:p:194-208

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    References listed on IDEAS

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    Cited by:

    1. Canares, Michael, 2009. "Macro-economic trends and their impacts on forests and forestry in Asia and the Pacific, outlook to 2020," MPRA Paper 28970, University Library of Munich, Germany.
    2. Ollivier, Hélène, 2012. "Growth, deforestation and the efficiency of the REDD mechanism," Journal of Environmental Economics and Management, Elsevier, vol. 64(3), pages 312-327.
    3. Petar Kurecic & Filip Kokotovic, 2017. "Examining the "Natural Resource Curse" and the Impact of Various Forms of Capital in Small Tourism and Natural Resource-Dependent Economies," Economies, MDPI, Open Access Journal, vol. 5(1), pages 1-24, February.
    4. Mills, Julianne H. & Waite, Thomas A., 2009. "Economic prosperity, biodiversity conservation, and the environmental Kuznets curve," Ecological Economics, Elsevier, vol. 68(7), pages 2087-2095, May.

    More about this item

    JEL classification:

    • Q23 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Forestry


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