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Spillover effects of blacklisting policy in the Brazilian Amazon

Author

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  • Luiza Andrade
  • André Luis Squarize Chagas

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.

Suggested Citation

  • Luiza Andrade & André Luis Squarize Chagas, 2016. "Spillover effects of blacklisting policy in the Brazilian Amazon," Working Papers, Department of Economics 2016_32, University of São Paulo (FEA-USP).
    • Handle: RePEc:spa:wpaper:2016wpecon32
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    References listed on IDEAS

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    Cited by:

    1. Alexander Pfaff & Juan Robalino, 2017. "Spillovers from Conservation Programs," Annual Review of Economics, Annual Reviews, vol. 9(1), pages 299-315, October.
    2. Maria Alice Moz-Christofoletti & Paula Carvalho Pereda & Wesley Campanharo, 2022. "Does Decentralized and Voluntary Commitment Reduce Deforestation? The Effects of Programa Municípios Verdes," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 82(1), pages 65-100, May.
    3. Juliano Assunção & Robert McMillan & Joshua Murphy & Eduardo Souza-Rodrigues, 2019. "Optimal Environmental Targeting in the Amazon Rainforest," NBER Working Papers 25636, National Bureau of Economic Research, Inc.
    4. Merkus, Erik, 2024. "The economic consequences of environmental enforcement: Evidence from an anti-deforestation policy in Brazil," World Development, Elsevier, vol. 181(C).
    5. Harding, Torfinn & Herzberg, Julika & Kuralbayeva, Karlygash, 2021. "Commodity prices and robust environmental regulation: Evidence from deforestation in Brazil," Journal of Environmental Economics and Management, Elsevier, vol. 108(C).
    6. Assunção, Juliano & Rocha, Romero, 2019. "Getting greener by going black: the effect of blacklisting municipalities on Amazon deforestation," Environment and Development Economics, Cambridge University Press, vol. 24(2), pages 115-137, April.
    7. Juliano Assuncao & Robert McMillan & Joshua Murphy & Eduardo Souza-Rodrigues, 2019. "Optimal Environmental Targeting in the Amazon Rainforest," Working Papers tecipa-631, University of Toronto, Department of Economics.

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    More about this item

    Keywords

    Deforestation; spillovers; Amazon; environmental policy;
    All these keywords.

    JEL classification:

    • Q23 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Forestry
    • Q28 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Government Policy
    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models

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