Crop prices and deforestation in the tropics

Nicolas Berman (), Mathieu Couttenier, Antoine Leblois and Raphael Soubeyran
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Nicolas Berman: AMSE - Aix-Marseille Sciences Economiques - EHESS - École des hautes études en sciences sociales - AMU - Aix Marseille Université - ECM - École Centrale de Marseille - CNRS - Centre National de la Recherche Scientifique, CEPR - Center for Economic Policy Research

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Abstract: Understanding the mechanisms of deforestation is necessary in order to slow or arrest its progress. To accomplish this requires rigorously estimating the demand for deforestation. We contribute to this endeavor by estimating the effect of crop prices on the demand for conversion of land from forest to agriculture in the tropics during the 21st century. The two main difficulties involved are the lack of harmonized data on local crop prices in the tropics and the fact that they are determined simultaneously with decisions to deforest. We propose a strategy to circumvent these two issues using high-resolution annual forest loss data for the tropics, combined with information on crop-specific agricultural suitability and annual international crop prices. We find that crop price variation has a significant impact on deforestation: increases in crop prices are estimated to be responsible for one-third of total deforestation in the tropics (totaling about 2 million km2) during the period 2001–2018. We also find that the degree of openness to international trade and the level of economic development are first-order local characteristics affecting the magnitude of the impact of crop prices on deforestation.

Keywords: Deforestation; Agricultural commodity prices (search for similar items in EconPapers)
Date: 2023-05
New Economics Papers: this item is included in nep-agr and nep-env
Note: View the original document on HAL open archive server: https://hal.inrae.fr/hal-04093064v1
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Published in Journal of Environmental Economics and Management, 2023, 119, pp.102819. ⟨10.1016/j.jeem.2023.102819⟩

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Related works:
Journal Article: Crop prices and deforestation in the tropics (2023)
Working Paper: Crop Prices and Deforestation in the Tropics (2022)
Working Paper: Crop Prices and Deforestation in the Tropics (2021)
Working Paper: Crop Prices and Deforestation in the Tropics (2021)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-04093064

DOI: 10.1016/j.jeem.2023.102819

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