Contagious development: Neighbor interactions in deforestation
Juan Robalino () and
Journal of Development Economics, 2012, vol. 97, issue 2, 427-436
We estimate neighbor interactions in deforestation in Costa Rica. To address simultaneity and the presence of spatially correlated unobservables, we measure for neighbors' deforestation using the slopes of neighbors' and neighbors' neighbors' parcels. We find that neighboring deforestation significantly raises the probability of deforestation. Policies for agricultural development or forest conservation in one area will affect deforestation rates in non-targeted neighboring areas. Correct estimation of the interaction reverses the naive estimate's prediction of multiple equilibria.
Keywords: Instrumental variable; Neighbors' interactions; Local interactions; Social interactions; Land use patterns; Environmental policies (search for similar items in EconPapers)
JEL-codes: O13 R12 Q24 (search for similar items in EconPapers)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:deveco:v:97:y:2012:i:2:p:427-436
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