IDEAS home Printed from https://ideas.repec.org/p/wai/econwp/17-14.html
   My bibliography  Save this paper

Forest Loss and Economic Inequality in the Solomon Islands: Using Small-Area Estimation to Link Environmental Change to Welfare Outcomes

Author

Abstract

To study welfare effects of environmental change, data from household surveys may be linked to remote sensing data. If linking uses spatial aggregation there is risk of ecological fallacy, since surveys are only representative for large areas that may not correspond to the spatial scale of the decision-making units. This paper uses survey-to-census imputation to estimate welfare indicators for small areas in order to study the effect of deforestation on subsequent inequality in the rural Solomon Islands. This country depends on logging for almost half of foreign exchange and one-sixth of government revenue, and most forested land remains under customary ownership. A sharp increase in log exports, to seven times the sustainable yield, and a major shift in export destinations as other countries withdrew from the tropical log trade represents an exogenous shock that helps to identify effects of deforestation on inequality rather than the reverse relationship. Using data for rural wards, that have about 400 households each, a standard deviation increase in the rate of forest loss over 2000 to 2012 raises the Gini index for household consumption in 2013 by one-third of a standard deviation. This precisely estimated effect would not be apparent using more spatially aggregated data.

Suggested Citation

  • John Gibson, 2017. "Forest Loss and Economic Inequality in the Solomon Islands: Using Small-Area Estimation to Link Environmental Change to Welfare Outcomes," Working Papers in Economics 17/14, University of Waikato.
    • Handle: RePEc:wai:econwp:17/14
    as

    Download full text from publisher

    File URL: https://repec.its.waikato.ac.nz/wai/econwp/1714.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Chris Elbers & Jean O. Lanjouw & Peter Lanjouw, 2003. "Micro--Level Estimation of Poverty and Inequality," Econometrica, Econometric Society, vol. 71(1), pages 355-364, January.
    2. Wunder, Sven & Angelsen, Arild & Belcher, Brian, 2014. "Forests, Livelihoods, and Conservation: Broadening the Empirical Base," World Development, Elsevier, vol. 64(S1), pages 1-11.
    3. Luc Anselin, 2001. "Spatial Effects in Econometric Practice in Environmental and Resource Economics," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 83(3), pages 705-710.
    4. Elbers, Chris & Lanjouw, Peter & Leite, Phillippe George, 2008. "Brazil within Brazil : testing the poverty map methodology in Minas Gerais," Policy Research Working Paper Series 4513, The World Bank.
    5. Deon Filmer & Lant Pritchett, 2001. "Estimating Wealth Effects Without Expenditure Data—Or Tears: An Application To Educational Enrollments In States Of India," Demography, Springer;Population Association of America (PAA), vol. 38(1), pages 115-132, February.
    6. Demombynes, Gabriel & Ozler, Berk, 2005. "Crime and local inequality in South Africa," Journal of Development Economics, Elsevier, vol. 76(2), pages 265-292, April.
    7. Babigumira, Ronnie & Angelsen, Arild & Buis, Maarten & Bauch, Simone & Sunderland, Terry & Wunder, Sven, 2014. "Forest Clearing in Rural Livelihoods: Household-Level Global-Comparative Evidence," World Development, Elsevier, vol. 64(S1), pages 67-79.
    8. Sims, Katharine R.E., 2010. "Conservation and development: Evidence from Thai protected areas," Journal of Environmental Economics and Management, Elsevier, vol. 60(2), pages 94-114, September.
    9. Angelsen, Arild & Jagger, Pamela & Babigumira, Ronnie & Belcher, Brian & Hogarth, Nicholas J. & Bauch, Simone & Börner, Jan & Smith-Hall, Carsten & Wunder, Sven, 2014. "Environmental Income and Rural Livelihoods: A Global-Comparative Analysis," World Development, Elsevier, vol. 64(S1), pages 12-28.
    10. Nguyen, Trung Thanh & Do, Truong Lam & Bühler, Dorothee & Hartje, Rebecca & Grote, Ulrike, 2015. "Rural livelihoods and environmental resource dependence in Cambodia," Ecological Economics, Elsevier, vol. 120(C), pages 282-295.
    11. Boyce, James K., 1994. "Inequality as a cause of environmental degradation," Ecological Economics, Elsevier, vol. 11(3), pages 169-178, December.
    12. Tara Bedi & Aline Coudouel & Kenneth Simler, 2007. "More Than a Pretty Picture : Using Poverty Maps to Design Better Policies and Interventions," World Bank Publications - Books, The World Bank Group, number 6800.
    13. James Boyce, 1994. "Inequality as a Cause of Environmental Degradation," Published Studies ps1, Political Economy Research Institute, University of Massachusetts at Amherst.
    14. Torras, Mariano & Boyce, James K., 1998. "Income, inequality, and pollution: a reassessment of the environmental Kuznets Curve," Ecological Economics, Elsevier, vol. 25(2), pages 147-160, May.
    15. David M. Drukker & Ingmar Prucha & Rafal Raciborski, 2013. "Maximum likelihood and generalized spatial two-stage least-squares estimators for a spatial-autoregressive model with spatial-autoregressive disturbances," Stata Journal, StataCorp LP, vol. 13(2), pages 221-241, June.
    16. Choumert, Johanna & Combes Motel, Pascale & Dakpo, Hervé K., 2013. "Is the Environmental Kuznets Curve for deforestation a threatened theory? A meta-analysis of the literature," Ecological Economics, Elsevier, vol. 90(C), pages 19-28.
    17. Vedeld, Paul & Angelsen, Arild & Bojo, Jan & Sjaastad, Espen & Kobugabe Berg, Gertrude, 2007. "Forest environmental incomes and the rural poor," Forest Policy and Economics, Elsevier, vol. 9(7), pages 869-879, April.
    18. Wunder, Sven & Börner, Jan & Shively, Gerald & Wyman, Miriam, 2014. "Safety Nets, Gap Filling and Forests: A Global-Comparative Perspective," World Development, Elsevier, vol. 64(S1), pages 29-42.
    19. Johanna Choumert & Pascale Combes Motel & K. Hervé Dakpo, 2013. "Is the Environmental Kuznets Curve for deforestation a threatened theory? A meta-analysis of the literature," Post-Print halshs-00806629, HAL.
    20. Julia Berazneva & Tanya S. Byker, 2017. "Does Forest Loss Increase Human Disease? Evidence from Nigeria," American Economic Review, American Economic Association, vol. 107(5), pages 516-521, May.
    21. Datt, Gaurav & Ravallion, Martin, 1992. "Growth and redistribution components of changes in poverty measures : A decomposition with applications to Brazil and India in the 1980s," Journal of Development Economics, Elsevier, vol. 38(2), pages 275-295, April.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Okumu, Boscow & Muchapondwa, Edwin, 2020. "Welfare and forest cover impacts of incentive based conservation: Evidence from Kenyan community forest associations," World Development, Elsevier, vol. 129(C).
    2. Carlo Fezzi & Mauro Derek J. Ford & Kirsten L.L. Oleson, 2022. "The economic value of coral reefs: climate change impacts and spatial targeting of restoration measures," DEM Working Papers 2022/5, Department of Economics and Management.
    3. John Gibson, 2020. "Deforestation and Resource Conflicts in Papua New Guinea," Working Papers in Economics 20/02, University of Waikato.
    4. Fergusson, Leopoldo & Saavedra, Santiago & Vargas, Juan F., 2020. "The perils of misusing remote sensing data: The case of forest cover," Working papers 41, Red Investigadores de Economía.
    5. Shang Xu & H. Allen Klaiber & Daniela A. Miteva, 2023. "Impacts of forest conservation on local agricultural labor supply: Evidence from the Indonesian forest moratorium," American Journal of Agricultural Economics, John Wiley & Sons, vol. 105(3), pages 940-965, May.
    6. Xiaoshi Zhou & Wanglin Ma & Gucheng Li & Huanguang Qiu, 2020. "Farm machinery use and maize yields in China: an analysis accounting for selection bias and heterogeneity," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 64(4), pages 1282-1307, October.
    7. Hai‐Anh H. Dang, 2021. "To impute or not to impute, and how? A review of poverty‐estimation methods in the absence of consumption data," Development Policy Review, Overseas Development Institute, vol. 39(6), pages 1008-1030, November.
    8. Fezzi, Carlo & Ford, Derek J. & Oleson, Kirsten L.L., 2023. "The economic value of coral reefs: Climate change impacts and spatial targeting of restoration measures," Ecological Economics, Elsevier, vol. 203(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Miller, Daniel C. & Hajjar, Reem, 2020. "Forests as pathways to prosperity: Empirical insights and conceptual advances," World Development, Elsevier, vol. 125(C).
    2. Bierkamp, Sina & Nguyen, Trung Thanh & Grote, Ulrike, 2021. "Environmental income and remittances: Evidence from rural central highlands of Vietnam," Ecological Economics, Elsevier, vol. 179(C).
    3. Chao Zhang & Ruifa Hu, 2020. "Does Fertilizer Use Intensity Respond to the Urban-Rural Income Gap? Evidence from a Dynamic Panel-Data Analysis in China," Sustainability, MDPI, vol. 12(1), pages 1-15, January.
    4. Nguyen, Trung Thanh & Do, Truong Lam & Halkos, George & Wilson, Clevo, 2020. "Health shocks and natural resource extraction: A Cambodian case study," Ecological Economics, Elsevier, vol. 169(C).
    5. Nerfa, Lauren & Rhemtulla, Jeanine M. & Zerriffi, Hisham, 2020. "Forest dependence is more than forest income: Development of a new index of forest product collection and livelihood resources," World Development, Elsevier, vol. 125(C).
    6. Jagger, Pamela & Cheek, Jennifer Zavaleta & Miller, Daniel & Ryan, Casey & Shyamsundar, Priya & Sills, Erin, 2022. "The Role of Forests and Trees in Poverty Dynamics," Forest Policy and Economics, Elsevier, vol. 140(C).
    7. Sadeghi, Azin & Zhunusova, Eliza & Günter, Sven & Dieter, Matthias, 2023. "Households' livelihood in restricted forest landscapes: What is the impact of contextual factors?," Forest Policy and Economics, Elsevier, vol. 154(C).
    8. Meyer, Maximilian & Hulke, Carolin & Kamwi, Jonathan & Kolem, Hannah & Börner, Jan, 2022. "Spatially heterogeneous effects of collective action on environmental dependence in Namibia’s Zambezi region," World Development, Elsevier, vol. 159(C).
    9. Felkner, John S. & Lee, Hyun & Shaikh, Sabina & Kolata, Alan & Binford, Michael, 2022. "The interrelated impacts of credit access, market access and forest proximity on livelihood strategies in Cambodia," World Development, Elsevier, vol. 155(C).
    10. Shyamsundar, Priya & Ahlroth, Sofia & Kristjanson, Patricia & Onder, Stefanie, 2020. "Supporting pathways to prosperity in forest landscapes – A PRIME framework," World Development, Elsevier, vol. 125(C).
    11. Watmough, Gary R. & Atkinson, Peter M. & Saikia, Arupjyoti & Hutton, Craig W., 2016. "Understanding the Evidence Base for Poverty–Environment Relationships using Remotely Sensed Satellite Data: An Example from Assam, India," World Development, Elsevier, vol. 78(C), pages 188-203.
    12. Nguyen, Thanh-Tung & Nguyen, Trung Thanh & Do, Manh Hung & Nguyen, Duy Linh & Grote, Ulrike, 2022. "Shocks, agricultural productivity, and natural resource extraction in rural Southeast Asia," World Development, Elsevier, vol. 159(C).
    13. Coomes, Oliver T. & Takasaki, Yoshito & Abizaid, Christian & Arroyo-Mora, J. Pablo, 2016. "Environmental and market determinants of economic orientation among rain forest communities: Evidence from a large-scale survey in western Amazonia," Ecological Economics, Elsevier, vol. 129(C), pages 260-271.
    14. Nguyen, Trung Thanh & Do, Truong Lam & Bühler, Dorothee & Hartje, Rebecca & Grote, Ulrike, 2015. "Rural livelihoods and environmental resource dependence in Cambodia," Ecological Economics, Elsevier, vol. 120(C), pages 282-295.
    15. Daniele Malerba, 2018. "How to reduce poverty and address climate change? An empirical cross-country analysis and the roles of economic growth and inequality," Global Development Institute Working Paper Series 322018, GDI, The University of Manchester.
    16. Daniele Malerba, 2020. "The Trade-off Between Poverty Reduction and Carbon Emissions, and the Role of Economic Growth and Inequality: An Empirical Cross-Country Analysis Using a Novel Indicator," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 150(2), pages 587-615, July.
    17. Torres, Bolier & Günter, Sven & Acevedo-Cabra, Ricardo & Knoke, Thomas, 2018. "Livelihood strategies, ethnicity and rural income: The case of migrant settlers and indigenous populations in the Ecuadorian Amazon," Forest Policy and Economics, Elsevier, vol. 86(C), pages 22-34.
    18. Londres, Marina & Schmink, Marianne & Börner, Jan & Duchelle, Amy E. & Frey, Gabriel Ponzoni, 2023. "Multidimensional forests: Complexity of forest-based values and livelihoods across Amazonian socio-cultural and geopolitical contexts," World Development, Elsevier, vol. 165(C).
    19. De Oñate-Calvín, Ruth & Oviedo, José L. & Salo, Matti, 2018. "Forest Resource-based Household Economy in the Communities of the Nanay River Basin, Peruvian Amazonia," Ecological Economics, Elsevier, vol. 146(C), pages 218-227.
    20. Belcher, Brian & Achdiawan, Ramadhani & Dewi, Sonya, 2015. "Forest-Based Livelihoods Strategies Conditioned by Market Remoteness and Forest Proximity in Jharkhand, India," World Development, Elsevier, vol. 66(C), pages 269-279.

    More about this item

    Keywords

    deforestation; inequality; poverty; small-area estimation;
    All these keywords.

    JEL classification:

    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • Q23 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Forestry

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wai:econwp:17/14. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Geua Boe-Gibson (email available below). General contact details of provider: https://edirc.repec.org/data/dewaknz.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.