The relation between forest clearance and household income among native Amazonians: Results from the Tsimane' Amazonian panel study, Bolivia

The Amazon rain forest harbors some of the world's richest biological diversity. During the twentieth century, two types of actors cleared that forest: native Amazonians and outside encroachers. Of the two actors, we know more about what drives outside encroachers to clear forest than about what drives native Amazonians to clear forest. The past research focus has served well because during the twentieth century outside encroachers cleared most of the Amazonian forest. But the past research focus needs to be expanded because native Amazonians are claiming de jure stewardship of the forests they inhabit, and with tighter jurisdiction over those forests will likely come changes in the amount of forest native Amazonians clear. Prior research in rural areas of low-income nations suggests that household income affects household forest clearance. To estimate the effects of household real income on the total forest area (old-growth+fallow) cleared by households we use a panel composed of five annual household surveys (2002-2006, inclusive) from 324 households of a native Amazonian society in Bolivia (Tsimane'). We control for household and village fixed effects and use an instrumental variable for household income. We find positive and significant household real income elasticities of forest clearance of 0.35 and 0.47 and an increase in forest clearance of 5.3%/year. The main finding stood up well to sensitivity analysis. These estimates suggest that in the near future, the forest in the Tsimane' territory will likely face increasing pressure from the Tsimane' themselves, not just from outside encroachers.