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The deforestation effects of trade and agricultural productivity in Brazil

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  • Carreira, Igor
  • Costa, Francisco
  • Pessoa, João Paulo

Abstract

This paper quantifies the relative footprint of trade and agricultural productivity on deforestation across Brazilian municipalities between 2000 and 2017. Using remote-sensing data, we identify distinct effects of these two phenomena on land use. Greater exposure to new genetically engineered soy seeds is associated with faster deforestation through cropland expansion. We find no significant association between local exposure to Chinese demand and deforestation, but exposure to trade with China mitigates the deforestation impacts from the new soy technology. Our findings suggest that, when considered together, productivity gains altering municipalities’ comparative advantage played a more significant role in driving deforestation across Brazil than Chinese demand alone.

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  • Carreira, Igor & Costa, Francisco & Pessoa, João Paulo, 2024. "The deforestation effects of trade and agricultural productivity in Brazil," Journal of Development Economics, Elsevier, vol. 167(C).
    • Handle: RePEc:eee:deveco:v:167:y:2024:i:c:s0304387823001736
    DOI: 10.1016/j.jdeveco.2023.103217
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    2. Leila Pereira & Rafael Pucci, 2024. "A Tale of Gold and Blood: The Consequences of Market Deregulation on Local Violence," Working Papers, Department of Economics 2024_18, University of São Paulo (FEA-USP).

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    More about this item

    Keywords

    Deforestation; Trade; Agricultural productivity; Technology; Soy; Brazil;
    All these keywords.

    JEL classification:

    • F18 - International Economics - - Trade - - - Trade and Environment
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • Q16 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - R&D; Agricultural Technology; Biofuels; Agricultural Extension Services
    • Q17 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agriculture in International Trade
    • Q23 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Forestry
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth

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