The Cost of Forest Preservation in the Brazilian Amazon: The "Arc of Deforestation"

Felipe de Figueiredo Silva, Lilyan Fulginiti and Richard Perrin

Journal of Agricultural and Resource Economics, 2019, vol. 44, issue 3

Abstract: We estimate the trade-off between agricultural production and forest preservation for the municipalities in Brazil's agricultural frontier, the so-called 'arc of deforestation,' using census and deforestation data for 2006. We use a nonparametric directional output distance function that allows us to identify the gradients of the production possibility frontier, which are the trade-offs of interest. We found that, on average, $979 is forgone in annual livestock, timber, and grain revenues to conserve 1 hectare of forest. This translates, ceteris paribus, to an average present value of costs to permanently sequester CO2 of $16.36/t, higher than most previous estimates.

Keywords: Environmental Economics and Policy; International Development (search for similar items in EconPapers)
Date: 2019
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:jlaare:292328

DOI: 10.22004/ag.econ.292328

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