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Determinants of Amazon Deforestation: The role of Off-Farm Income

Author

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  • Claudio ARAUJO

    (Centre d'Etudes et de Recherches sur le Développement International(CERDI))

  • Jean-Louis COMBES

    (Centre d'Etudes et de Recherches sur le Développement International(CERDI))

  • José Gustavo FERES

Abstract

This paper aims at assessing the determinants of Amazon deforestation, with an emphasis on the role played by off-farm income. We first present a microeconomic model which relates off-farm income to deforestation patterns. We then test the empirical implications by using data on the 2006 Brazilian Agricultural Census. Our results suggest that an increase in off-farm income tends to reduce deforestation. This may be explained by the fact that greater off-farm opportunities tends to increase the opportunity cost of farm labor. Results also show that smallholders are less responsive to the increase in the returns of off-farm activities than large ones, which is in line with our hypothesis of labor market imperfections regarding off-farm activities.

Suggested Citation

  • Claudio ARAUJO & Jean-Louis COMBES & José Gustavo FERES, 2014. "Determinants of Amazon Deforestation: The role of Off-Farm Income," Working Papers 201423, CERDI.
    • Handle: RePEc:cdi:wpaper:1626
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    Cited by:

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    2. Philippe Delacote & Julia Girard & Antoine Leblois, 2019. "Agricultural households' adaptation to weather shocks in Sub-Saharan Africa: What implications for land-use change and deforestation," Working Papers 1902, Chaire Economie du climat.
    3. Apeti, Ablam Estel & N’Doua, Bossoma Doriane, 2023. "The impact of timber regulations on timber and timber product trade," Ecological Economics, Elsevier, vol. 213(C).
    4. Ferreira, Marcelo Dias Paes & Féres, José Gustavo, 2020. "Farm size and Land use efficiency in the Brazilian Amazon," Land Use Policy, Elsevier, vol. 99(C).
    5. Ferreira, M. & Feres, J.G., 2018. "Farm Size and Productive Efficiency in Brazilian Amazon," 2018 Conference, July 28-August 2, 2018, Vancouver, British Columbia 277289, International Association of Agricultural Economists.
    6. Zabala, Aiora & Barrios, Luis Enrique García & Pascual, Unai, 2022. "From participation to commitment in silvopastoral programmes: Insights from Chiapas, Mexico," Ecological Economics, Elsevier, vol. 200(C).
    7. Silva, Felipe & Perrin, Richard K. & Fulginiti, Lilyan E., 2016. "Tradeoffs between forests and farming in the Legal Amazon Region of Brazil," 2016 Annual Meeting, February 6-9, 2016, San Antonio, Texas 230040, Southern Agricultural Economics Association.

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    More about this item

    Keywords

    Deforestation; Farm household; Off-farm income; Pseudo-panel;
    All these keywords.

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • Q23 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Forestry
    • Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets

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