Spillover effects of blacklisting policy in the Brazilian Amazon

Luiza Andrade () and André Chagas

No 2016_32, Working Papers, Department of Economics from University of São Paulo (FEA-USP)

Abstract: We analyse the effects of the Priority Municipalities List, that indicates the primary targets of environmental police monitoring, on deforestation of municipalities in the neighbourhood of the listed. We argue that being a neighbour to a priority municipality causes an exogenous variation in environmental authorities’ presence, and use a difference-in-differences estimator to determine the impact of such presence on deforestation. As an innovative feature, we introduce a spatial version of this estimator to correct spatial dependence. Our estimations show that the net effect of treatment is a decrease in deforestation of 15% to 36%. This result is robust to changes in the measure of deforestation as well as in the neighbourhood criteria. Estimates also indicate that effects get weaker the greater the distance to the priority municipality.

Keywords: Deforestation; spillovers; Amazon; environmental policy (search for similar items in EconPapers)
JEL-codes: C21 Q23 Q28 (search for similar items in EconPapers)
Date: 2016-12-07
New Economics Papers: this item is included in nep-env
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Citations: View citations in EconPapers (7)

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Related works:
Working Paper: SPILLOVER EFFECTS OF BLACKLISTING POLICY IN THE BRAZILIAN AMAZON (2018)
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