The economics of tropical deforestation

This paper provides a survey of 'first wave' economic studies of tropical d eforestation and land use. These studies of tropical forest land conversion are generally at the cross-country level. We also conduct a synthesis cros s-country analysis of tropical agricultural land expansion. The results sho w that agricultural development is the main factor determining land expansi on, but institutional factors have an important influence. Income effects t end to vary from region to region, and do not always display an 'Environmen tal Kuznets Curve' relationship. This paper also provides a review of the more recent 'second wave' economic studies of tropical deforestation that model and analyze the economic beha viour of agricultural households, timber concessionaires and other agents w ithin tropical forest countries who affect deforestation through their land use decisions. Further work in this area requires more country-level and l ocal case studies into tropical deforestation and land use.