IDEAS home Printed from
   My bibliography  Save this paper

Structural adjustment and forest resources - the impact of World Bank operations


  • Pandey, Kiran D.
  • Wheeler, David


Over two decades, the World Bank has undertaken many structural adjustment operations withgovernments of developing countries. During negotiations for structural adjustment loans (SALs), partner governments agree to specific policy reforms, whose implementation becomes a condition for disbursement of SAL funds. Conditionality varies with local circumstances, but generally supports privatization of state enterprises, liberalization of the domestic economy, and openness in international trade. Structural adjustment operations have often been controversial because they are explicitly political. Opposition, or support reflects ideological perspectives, perceptions of who gains, and who loses economically from a SAL, or beliefs about its environmental, and social impacts. Environmental groups express particular concern about SALs'impacts on the rate of deforestation. Debate about adjustment, and deforestation has been fueled largely by anecdotes, and a few country cases bases on limited time-series data. The authors broaden the analysis by combining a complete record of Bank SAL operations, with a 38-year socioeconomic database for 112 developing countries. They find that adjustment has greatly affected imports, exports, consumption, and production in many forest products sectors (such as fuel-wood, sawn-wood, panels, pulp, and paper). Some activities have increased, and some declined, but overall, the effects have balanced each other. The net impact on domestic round-wood production, the authors'proxy for forest exploitation, has been almost exactly zero. Their results suggest that growth in round-wood production is explained well by population growth, urbanization, and world demand for forest products. Their findings suggest that adjustment has not promoted domestic deforestation, but it has increased net imports of wood products, implying some displacement of pressure onto other countries'forest resources. They also find that devaluations have significantly increased the exploitation of forest resources.

Suggested Citation

  • Pandey, Kiran D. & Wheeler, David, 2001. "Structural adjustment and forest resources - the impact of World Bank operations," Policy Research Working Paper Series 2584, The World Bank.
  • Handle: RePEc:wbk:wbrwps:2584

    Download full text from publisher

    File URL:
    Download Restriction: no

    References listed on IDEAS

    1. Persson, Annika & Munasinghe, Mohan, 1995. "Natural Resource Management and Economywide Policies in Costa Rica: A Computable General Equilibrium (CGE) Modeling Approach," World Bank Economic Review, World Bank Group, vol. 9(2), pages 259-285, May.
    2. Glomsr D, Solveig & Monge, Maria Dolores & Vennemo, Haakon, 1999. "Structural adjustment and deforestation in Nicaragua," Environment and Development Economics, Cambridge University Press, vol. 4(01), pages 19-43, February.
    3. Angelsen, Arild & Shitindi, Eric F. Katemansimba & Aarrestad, Jostein, 1999. "Why do farmers expand their land into forests? Theories and evidence from Tanzania," Environment and Development Economics, Cambridge University Press, vol. 4(03), pages 313-331, July.
    4. Costanza, Robert, 1996. "The impact of ecological economics," Ecological Economics, Elsevier, vol. 19(1), pages 1-2, October.
    Full references (including those not matched with items on IDEAS)


    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.

    Cited by:

    1. Scrieciu, S. Serban, 2007. "Can economic causes of tropical deforestation be identified at a global level?," Ecological Economics, Elsevier, vol. 62(3-4), pages 603-612, May.
    2. Daigneault, Adam J. & Sohngen, Brent & Sedjo, Roger, 2008. "Exchange rates and the competitiveness of the United States timber sector in a global economy," Forest Policy and Economics, Elsevier, vol. 10(3), pages 108-116, January.
    3. Sedjo, Roger, 2005. "Macroeconomics and Forest Sustainability in the Developing World," Discussion Papers dp-05-47, Resources For the Future.
    4. World Bank, 2005. "Development Policy Lending and Forest Outcomes : Influences, Interactions, and Due Diligence," World Bank Other Operational Studies 8288, The World Bank.

    More about this item


    Environmental Economics&Policies; Labor Policies; Economic Theory&Research; Silviculture; Consumption; Environmental Economics&Policies; Economic Theory&Research; Silviculture; Forestry; Consumption;

    NEP fields

    This paper has been announced in the following NEP Reports:


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wbk:wbrwps:2584. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Roula I. Yazigi). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.