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  1. Deforestation Drivers: TheCase of the Brazilian Amazon Amanda Wheat American University School of International Service

  2. Research Question & Research hypothesis • Research Question • Does soy production, cattle production or timber extraction have an effect on deforestation in the Brazilian Amazon? Which has the strongest correlation? • Dependent Variable: Deforestation across nine Amazonian states • Independent variables: recorded timber extraction, cattle population, soy production from 1990-2012 • Research hypothesis/hypotheses • Controlling for timber extraction and soy production, deforestation in the Brazilian Amazon is positively correlated with the growth of cattle population.

  3. Background Information • Theory and findings from Nepstad (2006 ) • Theory: Cattle and Soy are the principle drivers of deforestation in Brazil. • Findings: The global demand for soy and cattle has significantly driven deforestation in Brazil in recent years. • Theory and findings from Hargrave (2013) • Theory: Cattle and Soy are the principle drivers of deforestation but deforestation rates can be limited with proper policy implementation. • Findings : Environmental fines from IBAMA can help curb deforestation rates in Brazil. • Empirical gaps in the existing literature: • The empirical gaps are data oriented. This research has several holes in certain states and it is not yet possible to accurately present data on environmental fines across states, therefore this study focuses primarily on deforestation as it relates to cattle growth in the nine Amazonian states of Brazil.

  4. Data • Unit of analysis : Deforestation in Brazil’s nine Amazon states • Source of the data: IGBE (The Brazilian Institute for Geography and Statistics • Reliability of the data: The data from IGBE is quite reliable but has some gaps in data collected by certain states. All models consider at least 130 cases. • Dependent variable • Y is Deforestation measures in km²/year and LOM is I-R • Independent Variable • X1 is Cattle (Heads of Cattle) and LOM is I-R • X2 is Soy (Hectares Planted) and LOM is I-R • X3 is Timber Extracted (Whole Logs) and LOM is I-R

  5. Descriptive Statistics

  6. Bivariate analysis – I-R LOM for Deforestation • Report Correlation table - for I-R LOM dependent variable. • Interpretation of reported statistics in these tables: • i)There is a moderate to strong positive correlation between the deforestation and the variable in question. • ii) The relationship between cattle and deforestation is very strong where Pearson’s r= .6418 which is statistically significant where (alpha =0.05). • iii) The correlation direction is positive.

  7. Graphic Representation of Relationships between Deforestation, Cattle and Soy

  8. Regression Analysis, OLS Estimates, The Dependent Variable is Log Deforestation • Interpretations: • i)The coefficient for lcattle is statistically significant and tells us that as heads of cattle increase 1%, deforestation increases .621% • ii.) The coefficient for lsoy is statistically significant: as soy production increases by 1%, deforestation increases by .108%. • iii.) Model 1 is the most reliable model to analyze the relationship between cattle and deforestation as it takes 199 cases into account and produces an adjusted R2of .453 which is moderately strong.

  9. Findings & Policy Implications of the research • Findings: • Finding #1: Accept research hypothesis that cattle and deforestation are positively correlated in the Brazilian Amazon and the relationships is statistically significant. • Finding #2: The relationship between soy and deforestation is also positively correlated but the relationship is less significant and data is less reliable as soy was not introduced to the Amazon until the late 1980’s. • What are the policy implications of your findings? • According to my findings the relationship between cattle and deforestation is stronger than the relationship between soy and cattle and thus environmental policies must focus on enforcing policies that protect Amazon forest from increasing numbers of cattle ranchers. • Key Recommendations: • More research is needed to assess which policies are most effective in battling deforestation in this area as it pertains to cattle ranching. • One method, the Low Emission Development Mechanism under REDD+ could provide economic incentives for semi-intensive cattle ranching, but more research is necessary to assess feasibility.