Work

The Effect of Rural Credit on Deforestation: Evidence from the Brazilian Amazon

Year: 2019

Type: article

Abstract: In 2008, the Brazilian government made the concession of rural credit in the Amazon conditional upon stricter requirements as an attempt to curb forest clearings. This article studies the impact of this innovative policy on deforestation. Difference-in-differences estimations based on a panel of municipalities show that the policy change led to a substantial reduction in deforestation, mostly in municipalities where cattle ranching is the leading economic activity. The results suggest that the mechanism underlying these effects was a restriction in access to rural credit, one of the main support mechanisms for agricultural production in Brazil.

Source: The Economic Journal

DOI: 10.1093/ej/uez060

Authors: Juliano Assunção, Clarissa Gandour, Romero Rocha, Rudi Rocha

Institutions: Pontifícia Universidade Católica do Rio de Janeiro, Universidade Federal do Rio de Janeiro, Escola de Administração de Empresas de São Paulo, Fundação Getulio Vargas

Language: English

Topic: Conservation, Biodiversity, and Resource Management

Subfield: Global and Planetary Change

Field: Environmental Science

Domain: Physical Sciences

SDGs: Life on land, Decent work and economic growth, Peace, justice, and strong institutions, Climate action

Open Access status: hybrid

Estimated APC paid: $3,000