Eustáquio
J.
Reis, IPEA, ejreis@ipea.gov.br
Diana
Weinhold, LSE, weinhold@lse.ac.uk
(Presenting)
Using some traditional and some more recent econometric results for model evaluation in panel data and a comprehensive data set on land use in the Brazilian Amazon, we revisit the question of whether the size composition of agricultural establishments in the Amazon region plays a role in determining the rate of deforestation. Fearnside (1993) has presented evidence that, contrary to some official Brazilian claims, small land holders account for a relatively small proportion of deforestation in the Amazon. States in which large establishments are relatively abundant are also those which tend to have the greatest percentage of deforested land, although small land holders deforest land more intensively.
We use census tract level data and a large array of variables to control for the natural vegetation, climate and economic environment to examine whether the size composition of establishments plays a signficant causal role in land use decisions and deforestation.. In addition we employ dynamic econometric modelling techniques rather than relying exclusively on contemporaneous correlation to study how these relationships have evolved over time and across space