Amazonian Deforestation, Environmental Kuznets Curve and Deforestation Policy: A Cointegration Approach

Philippe Polome () and Jérôme Trotignon ()
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Jérôme Trotignon: Université de Lyon, Lyon, F-69007, France ; CNRS, GATE Lyon St Etienne,F-69130 Ecully, France

No 1608, Working Papers from Groupe d'Analyse et de Théorie Economique Lyon St-Étienne (GATE Lyon St-Étienne), Université de Lyon

Abstract: Brazilian Amazon deforestation rate is found to display a unit root and to be cointegrated with Brazilian GDP and its square – An Environmental Kuznets Curve (EKC). Although, it is not the first time that such an EKC is detected, this may be the first such time-series evidence. Detecting an EKC is hampered by several econometric issues that have been shown to lead to possibly spurious results in cross-section and panel contexts, but are satisfactorily addressed in a cointegrated (time-series) framework. Alternative theories for explaining the deforestation path are rejected. There is evidence that the “Action Plan” of the Brazilian government against deforestation had an important effect. These results are in contrast to the economics literature on an EKC in emissions such asCO2, but appear to be consistent with a geographical sciences literature that considers that deforestation declines when alternative activities become available.

Keywords: Amazon deforestation; unit root; cointegration; “Action Plan”policy; Environmental Kuznets Curve (search for similar items in EconPapers)
JEL-codes: C22 Q23 Q28 (search for similar items in EconPapers)
Date: 2016
New Economics Papers: this item is included in nep-agr and nep-env
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Working Paper: Amazonian Deforestation, Environmental Kuznets Curve and Deforestation Policy: A Cointegration Approach (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:gat:wpaper:1608

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