Working Paper: NBER ID: w31410
Authors: Clare A. Balboni; Aaron Berman; Robin Burgess; Benjamin A. Olken
Abstract: Two factors have elevated recent academic and policy interest in tropical deforestation: first, the realization that it is a major contributor to climate change; and second, a revolution in satellite-based measurement that has revealed that it is proceeding at a rapid rate. We begin by reviewing the methodological advances that have enabled measurement of forest loss at a fine spatial resolution across the globe. We then develop a simple benchmark model of deforestation based on classic models of natural resource extraction. Extending this approach to incorporate features that characterize deforestation in developing countries---pressure for land use change, significant local and global externalities, weak property rights, and political economy constraints---provides us with a framework for reviewing the fast-growing empirical literature on the economics of deforestation in the tropics. This combination of theory and empirics provides insights not only into the economic drivers and impacts of tropical deforestation but also into policies that may affect its progression. We conclude by identifying areas where more work is needed in this important body of research.
Keywords: tropical deforestation; climate change; economic drivers; policy implications
JEL Codes: O13; Q23
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| economic incentives for alternative land use (Q15) | rate of deforestation (Q23) |
| changes in agricultural commodity prices (Q11) | economic incentives for alternative land use (Q15) |
| market access (L17) | economic incentives for alternative land use (Q15) |
| tropical deforestation (Q23) | global externality through carbon emissions (D62) |
| unclear property rights (P14) | deforestation (Q23) |