The Safety-net Use of Non Timber Forest Products

Philippe Delacote

No 2008-04, Working Papers - Cahiers du LEF from Laboratoire d'Economie Forestiere, AgroParisTech-INRA

Abstract: Incompleteness of insurance markets is a crucial weakness of developing countries. In this context, the poor households of rural regions often exploit common property resources, such as forests, as insurance in case of economics stress. The aim of this paper is to derive the implications of this insurance use on the forest cover, and thus on deforestation. The land-use choice between agricultural land and forest therefore resembles a portfolio diversification. However, I also show that this insurance strategy may lead to resource overexploitation and constitute a poverty trap.

Keywords: deforestation; household model; risk aversion; agricultural expansion; forest products (search for similar items in EconPapers)
JEL-codes: O12 O13 Q12 Q15 Q23 (search for similar items in EconPapers)
Pages: 29 pages
Date: 2008-09
New Economics Papers: this item is included in nep-agr and nep-ias
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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