Analytical perspectives: causes of deforestation
Sources and causes Agents and motivations Market failures
Efficiency markets ownership Natural resource abundance open access Property rights not well defined predatory
competition Externalities ecological functions
Institutional failures Lack of government institutions High costs of monitoring and fiscalization
Environmental functions (services) of tropical forests Global climate stability carbon
sequestration greenhouse effect (GWP intact forest nearly balanced)
Preservation of biodiversity scientific and aesthetic benefits (global)
Regional climate stability (~national) Hydrological balance and watershed
protection (local) Recycling of soil nutrients (local) Protection against fire susceptibility (local)
Scanty evidences on Brazilian biodiversity Global estimates 13 m (3 to 100)
species of which 1.5 m catalogued Brazil share is 10 to 20% or 150 a
300 thousand (megadiversity) 20% of world vegetation 10% of vertebrate animals
15 to 30 thousand catalogued 1% scientifically prospected
Amazon Deforestation and Carbon Dioxide Emissions, 1978-2003
Period Annual deforest
CO2 emissions109 ton
% of World
Km2 Min.(136 ton/ha)
Max.(198 ton/ha)
Min. Max
1978-88 22.273 0,31 0,45 4,4 6,31988-98 17.614 0,24 0,35 3,6 5,31998-03 20.133 0,27 0,40 4,5 6,6Source: Author’s estimates based upon Inpe’s deforestation data
Net carbon emissions from land use changes in Brazilian biomes, 1988-94 (MCT 2004)
BiomeNet emissions
TgC/yr TgCO2/yr %
Amazonia 116,9 428,6 59Cerrado (shrub) 51,5 188,7 26Atlantic forest 11,3 41,3 6Caatinga (arid) 10 36,5 5Pantanal (wetlands) 7,5 27,4 4Total 197,1 722,5 100
North Region: Secular growth performance, 1840-2000
North Region: GDP per capita (2000 R$) and growth rates,1840-2000
2,7 2,7 2,7 2,7 2,7 2,7 2,7
-13,7
2,2 2,2
-1,3
4,6 3,8
9,0
1,1-0,5
0,4 0,5 0,60,8
1,01,3
1,7
0,60,8 0,7
1,1
1,6
4,34,1
2,3
0,5
3,8
0
1
2
3
4
5
1840 1860 1880 1900 1920 1940 1960 1980 20002000
R$
-15
-10
-5
0
5
10
15
% p
.a.
GDPpcg%p.a. GDPg%p.a. GDP per capita
Rubber boom Rubber Demographic and 1840-1912 crisis economic lethargy 1912-1960
Regional policies1960-80
Macro crisis and stagnation 1980-2000
Stabilization 1994
Drivers of deforestation in Brazilian Amazon
Macroeconomic factors: growth and exports Accessibility to markets (transport cost) and geo-
ecological conditions (topology and rainfall) are crucial determinants of profitability and deforestation
Agricultural research (Embrapa) soybean Profits derived from productive activities -- logging,
cattle ranching and commercial crops (soybean) -- drives deforestation;
Government incentives and subsidies were important in the 70s not anymore; but federal transfers still make a significant contribution to urban income
Land price speculation play a temporary role in remote areas with costly access to markets;
Amazon deforestation x growth of Brazilian GDP (1988-2005)Def = 775*%GDP + 16.600 km2
Crescimento do PIB no Brasil e desflorestamento da Amazônia, 1978-2005
0
5.000
10.000
15.000
20.000
25.000
30.000
35.000
1977
/88
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
Ano agrícola (Sep-Aug)
Des
flore
stam
ento
(km
2/an
o)
-5,0
-3,0
-1,0
1,0
3,0
5,0
Cre
sc. P
IB (%
a.a
.)
Desflorestamento Cresc. PIB %
Regional differences in real land prices: cleared areas, 1966-2002
Brasil: Regional average real land prices for unplowed fields, 1966-2002 (R$ 2000/ha)
13.901
0
500
1000
1500
2000
2500
3000
1966
1967
1968
1969
1970
1971
1972
1973
1974
1975
1976
1977
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2000
R$/
ha
North Northeast East South West Brazil
Regional differences in real land prices: forest, 1966-2002
Brasil: Regional average real land prices for natural forest area, 1966-2002 (2000 R$/ha)
0
1000
2000
3000
4000
5000
6000
1966
1967
1968
1969
1970
1971
1972
1973
1974
1975
1976
1977
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2000
R$/
ha
North Northeast East South West Brazil
Transport costs ($/ton) to São Paulo, 1968
Transport costs ($/ton) to São Paulo, 1980
Transport costs ($/ton) to São Paulo, 1995
Transport costs ($/ton) to nearest state captital, 1968
Transport costs ($/ton) to nearest state captital, 1980
Transport costs ($/ton) to nearest state captital, 1995
Reduction in transport cost to national markets (São Paulo), 1968-80
Reduction in transport cost to national markets (São Paulo), 1980-95
Reduction in transport cost to local markets (State capital), 1968-80
Reduction in transport cost to local markets (State capital), 1980-95
Costs and benefits: roads(Fuller et al 2002, McVey 2002) Soybean trucked to markets (~ 800 miles) in very
poor road conditions 2 x US costs Paving of roads is a hot policy issue (Avança Brasil) Mechanical extrpaolations Laurance et. al 2002
catastrophic results; 35-50% of Amazonia deforested
Econometric models Andersen et al. 2002 Pfaff et al. 2005 more reasonable impacts
Roads lead to land use intensification (logging and cattle rising) deforestation impact depends on the elasticity of demand in relevant markets (Angelsen 1999): local x national markets
The Carajás investment program: the railway corridor (EFC), steel mills (+) and the impact area (AIC)
Trends and projections Geometric trend extrapolations of deforestation
are untenable. Land prices and land use intensification (short fallow) act as deterrents of deforestation. Systemic effects are important
The indirect long run effects of Carajás on deforestation are relatively small. Urban concentration of population increases land prices and reduces fertility rates
Policy trade-offs: deforestation x growth favors subsidized credit credit; deforestation x equity favor roads; land prices are crucial
Policy issues: impacts of Carajás Demographic transition and urbanization
smaller long run rates of population growth
Population density higher price of land intensification of land use saturation effects
Roads increased commercialization intensification of land use
Brazil: R&D expenditures on agriculture, 1973-1993
Brazil: Embrapa expenditure on R&D in agriculture (real terms and as % of Agricultural GDP)
0,0%
0,1%
0,2%
0,3%
0,4%
0,5%
0,6%
1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993
% A
gr.G
DP
0
1
2
3
4
5
6
7
Milh
ões
1993
BR
$
Real %Ag Gdp
Soybean yield in Legal Amazonia and in the rest of Brazil, 1975-2004 (ton/ha)
1,0
1,5
2,0
2,5
3,0
3,5
1975
1976
1977
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
Fonte: IBGE - PAM
ton/
ha
Legal Amazonia Rest of Brazil
Soybean yield in AML and the rest of Brazil, 1975-2004 (ton/ha)
Spatial dynamics of deforestation in Amazon
Squatter doing shifting cultivation and loggers are leading agents of (small scale) deforestation in wild areas
Cattle ranchers and large scale deforestation come in the second stage of frontier settlement
Commercial crops (soybean) penetrate in the third stage replacing pasture area with relatively small impact on deforestation in consolidated areas
Cattle herd in Legal Amazonia and in the rest of Brazil, 1975-2003 (million heads)
0
20
40
60
80
100
120
140
160
180
200
1975
1977
1979
1981
1983
1985
1987
1989
1991
1993
1995
1997
1999
2001
2003
Fonte: IBGE - PPM
Mill
ion
head
s
Rest of Brazil Legal Amazonia
Legal Amazonia: Cattle herd by State, 1977-2003
0
10
20
30
40
50
60
1975
1976
1977
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
Fonte: IBGE - PPM
Mill
ion
head
s
Mato Grosso Pará Rondônia Tocantins Maranhão Acre Amazonas Roraima Amapá
Cattle herd density (heads/km2), 1975
Cattle herd density (heads/km2), 1980
Cattle herd density (heads/km2), 1985
Cattle herd density (heads/km2), 1990
Cattle herd density (heads/km2), 1995
Cattle herd density (heads/km2), 2000
Cattle herd density (heads/km2), 2003
Cost and benefits: cattle raising (Margulis 2002, Faminow 1999, Andersen 2002)
Early settlers capitalize gains in land appropriation (land price speculation)
Large (capitalized) cattle ranchers appropriate most of the gains of forest conversion: rates of return in cattle ranching are potentially
high (circa 10% p.a.) Deforestation + small scale cattle ranching important
mechanism of social mobility extensive land use technologies
No ecological/precipitation constraint penetrates the rain forest
Economic/environmental sustainability of cattle ranching still an open issue
Soybean cropped area in Legal Amazonia and in the rest of Brazil, 1980-2004 (million ha)
0
2
4
6
8
10
12
14
16
18
20
22
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
Mill
lion
ha
Source: IBGE - PAM
Legal Amazonia Rest of Brazil
Legal Amazonia: Soybean cropped area by states, 1980-2004
0
1
2
3
4
5
6
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
Fonte: IBGE - PAM
Mill
ion
ha
Mato Grosso Maranhão Tocantins Pará Rondônia
Soybean: harvested area as % of area, 1975
Soybean: harvested area as % of area, 1980
Soybean: harvested area as % of area, 1985
Soybean: harvested area as % of area, 1990
Soybean: harvested area as % of area, 1995
Soybean: harvested area as % of area, 2000
Soybean: harvested area as % of municipal area, 2004
Cost and benefit: soybean (Ong 2004, Rezende 2004) The role of Embrapa agricultural research was
crucial specially for soybean cultivation Large scale mechanized technology leads to
income concentration but does not generate frontier proletarians
Agro-business activities urban employment Strong precipitation restrictions does not
penetrate the dense rain forest Comes in a later stage of settlement
mechanization requires no trunks and roots
Technology and deforestation (Angelsen and Kaimowitz 2001)
Sustainable development requires both higher productivity and forest conservation
Technological change (progress) Increase in TFP (total factor productivity) Embodied (in inputs) x disembodied (management) Factor saving x neutral changes
Technological change x deforestation Green revolution (Borlaug) hypothesis: fixed demand + higher
yield less agricultural area (global level) Subsistence hypothesis: new technology impact on land
requirements• Full belly x increased aspirations)• Land degradation hypothesis
Development hypothesis: dynamic feed backs are positive (EKC, forest transition, Nerlove)
Technology and deforestation
Selective logging is important source of finance for initial investment
Slash and burn technique is a rational response to the relative scarcity of labor and capital in the early stages of settlement
Cattle raising with extensive land use is a rational product/technology choice given the low prices of land and thus becomes the most important source of deforestation
Intensification requires adequate infrastructure (roads) and adequate topology
Geo-ecological (rainfall) barries to commercial crops (soybean as suplementary feeding)
Carbonstock inVegetation(ton / ha)
decomposition + use secondary recovery Time
abandon
1st burn
initial carbon stock
Above-ground carbon cycle in-slash-and-burn agriculture
Brazil: fire spots + forest fires, 2003QI (IBGE 2005)
Brazil: fire spots + forest fires, 2003QII (IBGE 2005)
Brazil: fire spots + forest fires, 2003QIII (IBGE 2005)
Brazil: fire spots + forest fires, 2003QIV (IBGE 2005)
Policy issues: technological options
The impact of land use intensification (both for logging and cattle ranching) on deforestation depends on the importance of local and national markets as destination of output (elasticity of demand)
Intensification in remote frontier areas is restricted by lack of transport infrastructure and by geo-ecological conditions (dense forest, topology, etc.)
Intensification will require technical government research and assistance as well as comprehensive campaigns of technology dissemination
Policy issues: fiscal and environmental instruments
The reduction of federal government transfer ( fiscal responsibility) will indirectly induce lower deforestation through increased taxation and lower disposable income• Taxation of land at municipal level is an
important policy issue• Transfer linked to deforestation performance• International compensation
Effective regulation of land use (forest reserve) is an important instrument to halt deforestation in critical environmental areas (rainforest, etc.)
Government investment in infrastructure (roads)
Total economic value (TEV) of the standing forest
Use values Existence
I. Direct II. Indirect III. Option 1. Sustainable logging and and extraction of other forets products
1. Local climate stability
1. Future uses of I. and II.
1. Preservation of cultural and aesthetic inheritance
2. Tourism and other recreational activities
2. Nutrient recycling
2. Insurance premium for the future use of biodiversity
3. Sicentific and educational services (genetic material)
3. Hydrological balance and protection of aquifers4. Global climate stability (carbon sequestration )
Empirical problems Dificulties of distinguishing indirect
use value, option values and existence values
Uncertainties in estimates are significant
The order of magnitude of benefits and beneficiaries
Rate of discount Benefits of future generations which are
more rich and better endowed with technology
Rate of discount = pure rate of intertemporal discount + elasticity of the marginal utility of consumption x growth rate of consumption
Value used are 2%, 6% and 12% a.a.
Total Economic Value (GDP) of deforested areas in Legal Amazonia from 1985-95 in US$ de 1995/ha (Andersen et al 2002)
Net present value of
Discount rates 2%p.a.
6% p.a.
12% p.a.
Rural GDP 1..657 553 276Total GDP 2.406 802 401Total Economic Value 3635 1.418 481Private benefits 1.425 475 237Local public benefits 590 163 74Global public benefits
1620 790 170
Policy issues in the Post-Kyoto environment Need of international compensation Avoided deforestation
Project x national level Non-permanence issue Sovereignity Leakages
Externality problems Transfer of technology: intensification will
require technical research and assistance as well as massive investments on technology dissemination
Policy issues in the Post-Kyoto environment
The reduction of federal government transfer (fiscal responsibility) will indirectly induce lower deforestation through increased taxation of economic activity• Taxation of land at municipal level could play
some role • Transfer linked to deforestation performance
Effective regulation of land use (forest concession and reserves) is an important instrument to halt deforestation in critical environmental areas (rainforest, biodiversity niches etc.)
Government investment in infrastructure (roads)
Brazilian geographic regions (Ibge 2005)
Table 3. Simulation of Percent Change in Converted Land (ARALT) per Hectare of MCA Land for the IPCC Scenarios A2 for the Timeslices 2050s and 2080s – Model C, Weighted
2050 A2 2080 A2Region E1 E2 E1 E2North -13 -11 -27 -26Northeast 11 12 27 30Southeast 11 11 15 15South 24 22 32 29Central-West
12 15 2 5
Brazil 12 13 14 15
Table 3. Simulation of Percent Change in Converted Land (ARALT) per Hectare of MCA Land for the IPCC Scenarios B2 for the Timeslices 2050s and 2080s – Model C, Weighted
2050 B2 2080 B2Region E1 E2 E1 E2North -21 -18 -41 -39Northeast 1 2 9 11Southeast 8 9 11 12South 18 16 19 17Central-West
9 12 -1 3
Brazil 6 7 5 7
Table 3. Simulation of Percent Change in Converted Land Value per Hectare for the IPCC Scenarios A2 for the Timeslices 2050s and 2080s – Model C, Weighted
2050 A2 2080 A2Region E1 E2 E1 E2North -32 -31 -63 -63Northeast 6 7 -5 -5Southeast 28 28 22 20South 202 201 602 592Central-West
84 82 134 126
Brazil 90 89 221 216
Table 3. Simulation of Percent Change in Converted Land Value per Hectare for the IPCC Scenarios B2 for the Timeslices 2050s and 2080s – Model C, Weighted
2050 B2 2080 B2Region E1 E2 E1 E2North -29 -28 -53 -52Northeast 2 4 1 2Southeast 18 18 24 23South 134 133 194 192Central-West
42 41 56 54
Brazil 57 56 79 78
