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Forestry and Agriculture

Paper Session

Sunday, Jan. 6, 2019 8:00 AM - 10:00 AM

Atlanta Marriott Marquis, M103
Hosted By: Association of Environmental and Resource Economists
  • Chair: Ben Meiselman, Johns Hopkins University

Protecting the Rainforest? The Case of Mahogany Prohibition and Deforestation

Ariaster Baumgratz Chimeli
,
University of Sao Paulo
Rodrigo Soares
,
Columbia University

Abstract

Tropical deforestation increases carbon emissions, reduces carbon sinks, simplifies
ecosystems, affect soil quality, can eliminate endemic species and can drastically change
labor market prospects for local populations. All of these consequences may lead to large
private gains and losses as well as global externalities and have drawn the attention of
scholars and policy makers. More recently, the Paris Agreement stemming from the XXI
Conference of the Parties placed protection of tropical forests as a key component for
curbing climate change. Among the main causes of tropical deforestation, several
commentators have identified logging of high-value timber species as an important
precursor of large scale deforestation. A number of countries have accepted this argument
and appealed to strict policies such as logging bans to protect specific species and forests.
One example of such policy is the Brazilian mahogany market prohibition. We find
evidence that the shutting down of this market combined with poor enforcement has led
to an even larger volume of illegal mahogany harvesting. We use this result and
differences-in-differences estimation to test whether municipalities where mahogany
naturally occurs have experienced increased deforestation after prohibition. Our paper
contains two main contributions: (i) evaluation of the impact of a timber market
prohibition policy on deforestation, and (ii) the testing of the hypothesis that harvesting
of high-value timber indirectly leads to large-scale deforestation. To our best knowledge,
no study has attempted to directly estimate this hypothesis, despite its prevalence in the
tropical deforestation literature and its use to at least partly justify forest protection
policies such as logging bans. Our results suggest that the mahogany prohibition policy in
Brazil meant to protect the species and the Amazon forest has instead led to increased
deforestation in affected areas.

Global Cost Estimates of Forest Climate Mitigation with Albedo: A New Integrative Policy Approach

Alice Favero
,
Georgia Institute of Technology
Brent Sohngen
,
Ohio State University

Abstract

Climate change mitigation policies have usually considered forest-based actions as cheap and fast options to reduce CO2 concentration in the atmosphere and slow down global warming. Most economic analyses, however, have ignored the effects of these actions on land surface albedo and the resulting effect on energy balance and temperature. This study estimates the marginal cost of forest mitigation associated with both carbon sequestration and albedo change, by introducing regional and forest-specific albedo information in a global dynamic forestry model. Our analysis indicates that traditional forest sequestration policies have underestimated the costs of climate mitigation, driving forest-based actions in regions where subsequent changes in albedo are significant. To reduce this inefficiency, this paper proposes a novel approach where both carbon sequestration and albedo effect are incorporated into pricing. Our results suggest that, under the same carbon price path, the integrative policy provides greater net global mitigation in absolute terms and per hectare of forest, and thus it is more efficient and less intrusive than the traditional policy.

Fires, Wind, and Smoke: Air Pollution and Infant Mortality

Hemant Kumar Pullabhotla
,
University of Illinois-Urbana-Champaign

Abstract

Globally, studies find an estimated 4 million people die prematurely because of air pollution every year. Much of this evidence relies on exposure-risk relations from studies focused on urban areas or uses extreme pollution events such as forest fires to identify the effect. Consequently, little is known about how air pollution impacts vulnerable sub-populations in the developing world where low incomes and limited access to health care in rural areas may heighten mortality risk. In this study, I exploit seasonal changes in air quality arising due to agricultural fires – a widespread practice used by farmers across the developing world to clear land for planting. Unlike large events like forest fires, agricultural fires are a marginal increase in pollution and thus reflect common levels of pollution exposure. I estimate the causal impact of air pollution on infant mortality at a countrywide scale by linking satellite imagery on the location and timing of more than 800,000 agricultural fires with air quality data from pollution monitoring stations and geocoded survey data on nearly half-a-million births across India over a ten-year period. To address the concern that fires may be more prevalent in wealthier agricultural regions, I use satellite data on wind direction to isolate the effect of upwind fires, controlling for other nearby fires. I find that a 10 microgram per cubic meter increase in PM10 results in more than 90,000 additional infant deaths per year, nearly twice the number found in previous studies. The mortality burden is much higher among rural households and the urban poor. These findings underscore the need to better understand the heterogeneity in pollution impacts and suggest that failure to do so results in underestimating these adverse effects.

Modeling the Effects of Subsidizing Timber Harvests on Lands Vulnerable to Disturbance

Matthew Ryan Sloggy
,
Colorado State University
Greg Latta
,
University of Idaho
Andrew Plantinga
,
University of California-Santa Barbara

Abstract

Natural forest disturbances such as wildfires and pest infestations inflict large scale damages on
human health, environmental quality, and economic productivity. Policies addressing the
frequency and severity of these disturbance events exist; however, modeling the effects that these
policies have is difficult. One issue is that the resolution and scale of currently available forest
sector models is limited such that fine-scale spatially targeted policies cannot be experimented
with over a large scale. In order to model the effects of spatially targeted policies on timber
harvest, we construct a spatial partial equilibrium forest sector model for the western United
States, solved at a high resolution. The model solves quickly due to a price-search algorithm that
simulates auctions between agents in the model. Because the model can couple to environmental
land process models, it captures the feedback between forest disturbance and economic activity
in the forest sector, and demonstrates how short-term and long-term harvest patterns adapt to
these disturbance events, as well as to our policy experiment. We utilize data on disturbance risk
to formulate a policy experiment that subsidizes timber harvest in at-risk areas. Though forest
landowners may internalize the risk of disturbance to their own forestland, the risk of disturbance
their land poses to neighboring forestland is generally not internalized. We find that when
harvest
Discussant(s)
Paul Ferraro
,
Johns Hopkins University
Andrew Plantinga
,
University of California-Santa Barbara
Teevrat Garg
,
University of California-San Diego
Brent Sohngen
,
Ohio State University
JEL Classifications
  • Q2 - Renewable Resources and Conservation
  • Q1 - Agriculture