SUMMARY Brazil nut collection is key to reconciling sustainable economic development with forest ... more SUMMARY Brazil nut collection is key to reconciling sustainable economic development with forest conservation in the Amazon. Whether the activity is profitable, however, remains uncertain due to the paucity of information on spatial distribution and productivity of trees as well as the costs of collection and processing. To fill this gap, this study developed and used a spatially-explicit rent model of Brazil nut production to assess yields and potential profits (rents) from the Brazil nut concessions in Madre de Dios (Peru), under three scenarios of processing and management (unshelled, shelled and shelled-certified nuts). Potential annual production in the region was estimated to be 14.1 ± 2.4 thousand tonnes of unshelled nuts; at 2008 regional sale prices this corresponded to profits of between US$ 3.1 ± 0.5 ha −1 yr −1 for unshelled nuts to US$ 8.4 ± 1.4 ha −1 yr −1 for shelled-certified nuts. Investment of c. US$ 14−17 ha −1 is required to develop certified production in Madre de Dios concessions; this would approximately triple rents in these areas. Such investment could be channelled through REDD+ projects; sustainable management of Brazil nut concessions may contribute to a 42–43% reduction in deforestation in Madre de Dios by 2050.
Voluntary labeling improves market efficiency if consumers receive the product characteristics th... more Voluntary labeling improves market efficiency if consumers receive the product characteristics they demand and producers are compensated for producing these characteristics. For this to occur, label claims have to be truthful, credible, and understandable. We examine the introduction of " Raised Without Antibiotics " (RWA) label claims in the broiler industry by Perdue Farms (Perdue) and Tyson Foods (Tyson) in 2007 and the events that follow. We ask whether voluntary label claims were able to improve efficiency in the market for RWA chicken products. In this case, evidence presented as part of court testimony suggests that Tyson did not deliver the RWA attribute that consumers demanded, competitors suffered, and Tyson profited from introducing what was ruled to be a false and misleading label claim to the marketplace. While the media informed consumers and stockholders of these events, we found little evidence in publicly available data, literature, or documentation from court cases that Tyson suffered significant harm in the market, or from stockholders. The U.S. Department of Agriculture Food Safety and Inspection Service did ultimately remove Tyson's label claims from the marketplace, and the legal system provided some redress to competitors and consumers. Even so, labels with animal raising claims (such as RWA) and voluntary, process-based label claims (in general) continue to be challenged by similar issues, that is, consumer confusion, the absence of universally accepted definitions, and varying degrees of credibility.
Deforestation in the Brazilian Amazon released approximately 5.7 billion tons of CO2 to the atmos... more Deforestation in the Brazilian Amazon released approximately 5.7 billion tons of CO2 to the atmosphere between 2000 and 2010, and 50–80% of this deforestation was for pasture. Most assume that increasing demand for cattle products produced in Brazil caused this deforestation, but the empirical work to-date on cattle documents only correlations between cattle herd size, pasture expansion, cattle prices, and deforestation. This paper uses panel data on deforestation and foot-and-mouth disease (FMD) status—an exogenous demand shifter—to estimate whether changes in FMD status caused new deforestation in municipalities in the Brazilian Amazon and cerrado biomes during the 2000–2010 period. Results suggest that, on average, becoming certified as FMD-free caused a temporary spike in deforestation in the 2 years after a municipality became FMD-free, but caused subsequent deforestation to decline relative to infected municipalities during the 2000–2010 period.
In response to a shift toward specialization and mechanization during the 20th century, there has... more In response to a shift toward specialization and mechanization during the 20th century, there has been momentum on the part of a vocal contingent of consumers, producers, researchers, and policy makers who call for a transition toward a new model of agriculture. This model employs fewer synthetic inputs, incorporates practices which enhance biodiversity and environmental services at local, regional, and global scales, and takes into account the social implications of production practices, market dynamics, and product mixes. Within this vision, diversified farming systems (DFS) have emerged as a model that incorporates functional biodiversity at multiple temporal and spatial scales to maintain ecosystem services critical to agricultural production. Our aim is to provide an economists' perspective on the factors which make diversified farming systems (DFS) economically attractive, or not-so-attractive, to farmers, and to discuss the potential for and roadblocks to widespread adoption. We focus on how a range of existing and emerging factors drive profitability and adoption of DFS. We believe that, in order for DFS to thrive, a number of structural changes are needed. These include: 1) public and private investment in the development of low-cost, practical technologies that reduce the costs of production in DFS, 2) support for and coordination of evolving markets for ecosystem services and products from DFS and 3) the elimination of subsidies and crop insurance programs that perpetuate the unsustainable production of staple crops. We suggest that subsidies and funding be directed, instead, toward points 1) and 2), as well as toward incentives for consumption of nutritious food.
This study contributes to the design of public policies for the forestry sector in Madre de Dios,... more This study contributes to the design of public policies for the forestry sector in Madre de Dios, Peru. We developed a timber rent model that estimates optimal stumpage fees and compared three scenarios of harvestable areas access versus two harvest methods to calculate potential revenues to the State. We found that current stumpage fees undervalue timber resources and thus provide windfall profits to loggers. Annual forest revenues to the State could be increased from US$1 million to a maximum annual average of US$23.4 ± 1.4 million over a 20-year period if the fee structure suggested from our estimations were adopted. Similarly, we show that the spatial distribution of current fees encourages timber harvesting outside of timber concessions, in particular from Brazil-nut concessions, which compete with timber concessions to supply timber to markets. Our results suggest that timber harvesting should be limited to a maximum volume of 5 m 3 /ha inside Brazil-nut concessions and that timber harvesting in all Madre de Dios could be increased by up to~200% over the next 20 years without threatening conservation areas. This would in turn provide additional revenues to the State that could be applied to better monitoring and forest management.
Fed by demand for beef within Brazil and in global markets, the Brazilian herd grew from 147 mill... more Fed by demand for beef within Brazil and in global markets, the Brazilian herd grew from 147 million head of cattle in 1990 to
≈200 million in 2007. Eighty-three percent of this expansion occurred in the Amazon and this trend is expected to continue as the industry bounces back from a recent agricultural downturn. Intensification of the cattle industry has been suggested as one way to reduce pressure on forest margins and spare land for soybean or sugarcane production, and is the cornerstone of Brazil’s plan for mitigation of greenhouse gas emissions. To this end, federal credit programs and research and development activities in Brazil are aligning to support intensification goals, but there is no guarantee that this push for intensification will decrease the demand for land at the forest margin and as result curb CO2 emissions from deforestation. In this paper we use a spatially explicit rent model which incorporates the local effects of biophysical characteristics, infrastructure, land prices, and distance to markets and slaughterhouses to calculate 30-year Net Present Values (NPVs) of extensive cattle ranching across the
Brazilian Amazon. We use the model to ask where extensive ranching is profitable and how land acquisition affects profitability. We estimate that between 17% and 80% of land in the Amazon would have moderate to high NPVs when ranched extensively if it were settled, i.e. if the rancher does not buy the
land but acquires it through land grabbing. In addition, we estimate that between 9% and 13% of land in the Amazon is vulnerable to speculation (i.e. areas with positive NPVs only if land is settled and not purchased), which suggests that land speculation is an important driver of extensive ranching profitability, and may continue to be in the future. These results suggest that pro-intensification policies such as credit provision for improved pasture management and investment in more intensive production systems must be accompanied by implementation and enforcement of policies that alter the incentives to clear forest for pasture, discourage land speculation, and increase accountability for land management practices if intensification of the cattle sector is to deter new deforestation and displace production from low-yield, extensive cattle production systems in frontier regions of the Brazilian Amazon.
Abstract Land-clearing fires set by settlers in the Brazilian Amazon give rise to large scale wil... more Abstract Land-clearing fires set by settlers in the Brazilian Amazon give rise to large scale wildfires that threaten mature forests, agricultural plantations, and settlement areas. Our purpose is to examine labor devoted to fire prevention (firebreak establishment) and burning for crop production for subsistence smallholders in the Tapajós National Forest in Pará, Brazil. Both the decision to engage in each activity and the scale of the activity are examined.
This study contributes to the design of public policies for the forestry sector in Madre de Dios,... more This study contributes to the design of public policies for the forestry sector in Madre de Dios, Peru. We developed a timber rent model that estimates optimal stumpage fees and compared three scenarios of harvestable areas access versus two harvest methods to calculate potential revenues to the State. We found that current stumpage fees undervalue timber resources and thus provide windfall profits to loggers.
Tropical deforestation is the cause of 8 to 25% of world-wide, human-induced emissions of carbon ... more Tropical deforestation is the cause of 8 to 25% of world-wide, human-induced emissions of carbon to the atmosphere (Canadell et al. 2007). Despite this, the Kyoto Protocol provides no incentives for reducing deforestation (Schlamadinger et al 2007). In 2005, at the Montreal Conference of the Parties of the UN Framework Convention on Climate Change, a proposal was formally made to include deforestation in the post-2012 UNFCCC regime (Gullison et al. 2007).
Abstract:" Recent research and policy on reducing greenhouse gas (GHG) emissions in Brazil sugges... more Abstract:" Recent research and policy on reducing greenhouse gas (GHG) emissions in Brazil suggests that the least-cost, largest-scale mitigation option is for cattle ranchers to produce more on the land they already use. The rationale is that cattle ranching intensification programs (CRIPs) can speed yield-increasing technology adoption that delivers GHG benefits by sparing land to prevent deforestation and allow more biofuels production and other productive uses.
SUMMARY Brazil nut collection is key to reconciling sustainable economic development with forest ... more SUMMARY Brazil nut collection is key to reconciling sustainable economic development with forest conservation in the Amazon. Whether the activity is profitable, however, remains uncertain due to the paucity of information on spatial distribution and productivity of trees as well as the costs of collection and processing. To fill this gap, this study developed and used a spatially-explicit rent model of Brazil nut production to assess yields and potential profits (rents) from the Brazil nut concessions in Madre de Dios (Peru), under three scenarios of processing and management (unshelled, shelled and shelled-certified nuts). Potential annual production in the region was estimated to be 14.1 ± 2.4 thousand tonnes of unshelled nuts; at 2008 regional sale prices this corresponded to profits of between US$ 3.1 ± 0.5 ha −1 yr −1 for unshelled nuts to US$ 8.4 ± 1.4 ha −1 yr −1 for shelled-certified nuts. Investment of c. US$ 14−17 ha −1 is required to develop certified production in Madre de Dios concessions; this would approximately triple rents in these areas. Such investment could be channelled through REDD+ projects; sustainable management of Brazil nut concessions may contribute to a 42–43% reduction in deforestation in Madre de Dios by 2050.
Voluntary labeling improves market efficiency if consumers receive the product characteristics th... more Voluntary labeling improves market efficiency if consumers receive the product characteristics they demand and producers are compensated for producing these characteristics. For this to occur, label claims have to be truthful, credible, and understandable. We examine the introduction of " Raised Without Antibiotics " (RWA) label claims in the broiler industry by Perdue Farms (Perdue) and Tyson Foods (Tyson) in 2007 and the events that follow. We ask whether voluntary label claims were able to improve efficiency in the market for RWA chicken products. In this case, evidence presented as part of court testimony suggests that Tyson did not deliver the RWA attribute that consumers demanded, competitors suffered, and Tyson profited from introducing what was ruled to be a false and misleading label claim to the marketplace. While the media informed consumers and stockholders of these events, we found little evidence in publicly available data, literature, or documentation from court cases that Tyson suffered significant harm in the market, or from stockholders. The U.S. Department of Agriculture Food Safety and Inspection Service did ultimately remove Tyson's label claims from the marketplace, and the legal system provided some redress to competitors and consumers. Even so, labels with animal raising claims (such as RWA) and voluntary, process-based label claims (in general) continue to be challenged by similar issues, that is, consumer confusion, the absence of universally accepted definitions, and varying degrees of credibility.
Deforestation in the Brazilian Amazon released approximately 5.7 billion tons of CO2 to the atmos... more Deforestation in the Brazilian Amazon released approximately 5.7 billion tons of CO2 to the atmosphere between 2000 and 2010, and 50–80% of this deforestation was for pasture. Most assume that increasing demand for cattle products produced in Brazil caused this deforestation, but the empirical work to-date on cattle documents only correlations between cattle herd size, pasture expansion, cattle prices, and deforestation. This paper uses panel data on deforestation and foot-and-mouth disease (FMD) status—an exogenous demand shifter—to estimate whether changes in FMD status caused new deforestation in municipalities in the Brazilian Amazon and cerrado biomes during the 2000–2010 period. Results suggest that, on average, becoming certified as FMD-free caused a temporary spike in deforestation in the 2 years after a municipality became FMD-free, but caused subsequent deforestation to decline relative to infected municipalities during the 2000–2010 period.
In response to a shift toward specialization and mechanization during the 20th century, there has... more In response to a shift toward specialization and mechanization during the 20th century, there has been momentum on the part of a vocal contingent of consumers, producers, researchers, and policy makers who call for a transition toward a new model of agriculture. This model employs fewer synthetic inputs, incorporates practices which enhance biodiversity and environmental services at local, regional, and global scales, and takes into account the social implications of production practices, market dynamics, and product mixes. Within this vision, diversified farming systems (DFS) have emerged as a model that incorporates functional biodiversity at multiple temporal and spatial scales to maintain ecosystem services critical to agricultural production. Our aim is to provide an economists' perspective on the factors which make diversified farming systems (DFS) economically attractive, or not-so-attractive, to farmers, and to discuss the potential for and roadblocks to widespread adoption. We focus on how a range of existing and emerging factors drive profitability and adoption of DFS. We believe that, in order for DFS to thrive, a number of structural changes are needed. These include: 1) public and private investment in the development of low-cost, practical technologies that reduce the costs of production in DFS, 2) support for and coordination of evolving markets for ecosystem services and products from DFS and 3) the elimination of subsidies and crop insurance programs that perpetuate the unsustainable production of staple crops. We suggest that subsidies and funding be directed, instead, toward points 1) and 2), as well as toward incentives for consumption of nutritious food.
This study contributes to the design of public policies for the forestry sector in Madre de Dios,... more This study contributes to the design of public policies for the forestry sector in Madre de Dios, Peru. We developed a timber rent model that estimates optimal stumpage fees and compared three scenarios of harvestable areas access versus two harvest methods to calculate potential revenues to the State. We found that current stumpage fees undervalue timber resources and thus provide windfall profits to loggers. Annual forest revenues to the State could be increased from US$1 million to a maximum annual average of US$23.4 ± 1.4 million over a 20-year period if the fee structure suggested from our estimations were adopted. Similarly, we show that the spatial distribution of current fees encourages timber harvesting outside of timber concessions, in particular from Brazil-nut concessions, which compete with timber concessions to supply timber to markets. Our results suggest that timber harvesting should be limited to a maximum volume of 5 m 3 /ha inside Brazil-nut concessions and that timber harvesting in all Madre de Dios could be increased by up to~200% over the next 20 years without threatening conservation areas. This would in turn provide additional revenues to the State that could be applied to better monitoring and forest management.
Fed by demand for beef within Brazil and in global markets, the Brazilian herd grew from 147 mill... more Fed by demand for beef within Brazil and in global markets, the Brazilian herd grew from 147 million head of cattle in 1990 to
≈200 million in 2007. Eighty-three percent of this expansion occurred in the Amazon and this trend is expected to continue as the industry bounces back from a recent agricultural downturn. Intensification of the cattle industry has been suggested as one way to reduce pressure on forest margins and spare land for soybean or sugarcane production, and is the cornerstone of Brazil’s plan for mitigation of greenhouse gas emissions. To this end, federal credit programs and research and development activities in Brazil are aligning to support intensification goals, but there is no guarantee that this push for intensification will decrease the demand for land at the forest margin and as result curb CO2 emissions from deforestation. In this paper we use a spatially explicit rent model which incorporates the local effects of biophysical characteristics, infrastructure, land prices, and distance to markets and slaughterhouses to calculate 30-year Net Present Values (NPVs) of extensive cattle ranching across the
Brazilian Amazon. We use the model to ask where extensive ranching is profitable and how land acquisition affects profitability. We estimate that between 17% and 80% of land in the Amazon would have moderate to high NPVs when ranched extensively if it were settled, i.e. if the rancher does not buy the
land but acquires it through land grabbing. In addition, we estimate that between 9% and 13% of land in the Amazon is vulnerable to speculation (i.e. areas with positive NPVs only if land is settled and not purchased), which suggests that land speculation is an important driver of extensive ranching profitability, and may continue to be in the future. These results suggest that pro-intensification policies such as credit provision for improved pasture management and investment in more intensive production systems must be accompanied by implementation and enforcement of policies that alter the incentives to clear forest for pasture, discourage land speculation, and increase accountability for land management practices if intensification of the cattle sector is to deter new deforestation and displace production from low-yield, extensive cattle production systems in frontier regions of the Brazilian Amazon.
Abstract Land-clearing fires set by settlers in the Brazilian Amazon give rise to large scale wil... more Abstract Land-clearing fires set by settlers in the Brazilian Amazon give rise to large scale wildfires that threaten mature forests, agricultural plantations, and settlement areas. Our purpose is to examine labor devoted to fire prevention (firebreak establishment) and burning for crop production for subsistence smallholders in the Tapajós National Forest in Pará, Brazil. Both the decision to engage in each activity and the scale of the activity are examined.
This study contributes to the design of public policies for the forestry sector in Madre de Dios,... more This study contributes to the design of public policies for the forestry sector in Madre de Dios, Peru. We developed a timber rent model that estimates optimal stumpage fees and compared three scenarios of harvestable areas access versus two harvest methods to calculate potential revenues to the State. We found that current stumpage fees undervalue timber resources and thus provide windfall profits to loggers.
Tropical deforestation is the cause of 8 to 25% of world-wide, human-induced emissions of carbon ... more Tropical deforestation is the cause of 8 to 25% of world-wide, human-induced emissions of carbon to the atmosphere (Canadell et al. 2007). Despite this, the Kyoto Protocol provides no incentives for reducing deforestation (Schlamadinger et al 2007). In 2005, at the Montreal Conference of the Parties of the UN Framework Convention on Climate Change, a proposal was formally made to include deforestation in the post-2012 UNFCCC regime (Gullison et al. 2007).
Abstract:" Recent research and policy on reducing greenhouse gas (GHG) emissions in Brazil sugges... more Abstract:" Recent research and policy on reducing greenhouse gas (GHG) emissions in Brazil suggests that the least-cost, largest-scale mitigation option is for cattle ranchers to produce more on the land they already use. The rationale is that cattle ranching intensification programs (CRIPs) can speed yield-increasing technology adoption that delivers GHG benefits by sparing land to prevent deforestation and allow more biofuels production and other productive uses.
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Papers by Maria Bowman
≈200 million in 2007. Eighty-three percent of this expansion occurred in the Amazon and this trend is expected to continue as the industry bounces back from a recent agricultural downturn. Intensification of the cattle industry has been suggested as one way to reduce pressure on forest margins and spare land for soybean or sugarcane production, and is the cornerstone of Brazil’s plan for mitigation of greenhouse gas emissions. To this end, federal credit programs and research and development activities in Brazil are aligning to support intensification goals, but there is no guarantee that this push for intensification will decrease the demand for land at the forest margin and as result curb CO2 emissions from deforestation. In this paper we use a spatially explicit rent model which incorporates the local effects of biophysical characteristics, infrastructure, land prices, and distance to markets and slaughterhouses to calculate 30-year Net Present Values (NPVs) of extensive cattle ranching across the
Brazilian Amazon. We use the model to ask where extensive ranching is profitable and how land acquisition affects profitability. We estimate that between 17% and 80% of land in the Amazon would have moderate to high NPVs when ranched extensively if it were settled, i.e. if the rancher does not buy the
land but acquires it through land grabbing. In addition, we estimate that between 9% and 13% of land in the Amazon is vulnerable to speculation (i.e. areas with positive NPVs only if land is settled and not purchased), which suggests that land speculation is an important driver of extensive ranching profitability, and may continue to be in the future. These results suggest that pro-intensification policies such as credit provision for improved pasture management and investment in more intensive production systems must be accompanied by implementation and enforcement of policies that alter the incentives to clear forest for pasture, discourage land speculation, and increase accountability for land management practices if intensification of the cattle sector is to deter new deforestation and displace production from low-yield, extensive cattle production systems in frontier regions of the Brazilian Amazon.
≈200 million in 2007. Eighty-three percent of this expansion occurred in the Amazon and this trend is expected to continue as the industry bounces back from a recent agricultural downturn. Intensification of the cattle industry has been suggested as one way to reduce pressure on forest margins and spare land for soybean or sugarcane production, and is the cornerstone of Brazil’s plan for mitigation of greenhouse gas emissions. To this end, federal credit programs and research and development activities in Brazil are aligning to support intensification goals, but there is no guarantee that this push for intensification will decrease the demand for land at the forest margin and as result curb CO2 emissions from deforestation. In this paper we use a spatially explicit rent model which incorporates the local effects of biophysical characteristics, infrastructure, land prices, and distance to markets and slaughterhouses to calculate 30-year Net Present Values (NPVs) of extensive cattle ranching across the
Brazilian Amazon. We use the model to ask where extensive ranching is profitable and how land acquisition affects profitability. We estimate that between 17% and 80% of land in the Amazon would have moderate to high NPVs when ranched extensively if it were settled, i.e. if the rancher does not buy the
land but acquires it through land grabbing. In addition, we estimate that between 9% and 13% of land in the Amazon is vulnerable to speculation (i.e. areas with positive NPVs only if land is settled and not purchased), which suggests that land speculation is an important driver of extensive ranching profitability, and may continue to be in the future. These results suggest that pro-intensification policies such as credit provision for improved pasture management and investment in more intensive production systems must be accompanied by implementation and enforcement of policies that alter the incentives to clear forest for pasture, discourage land speculation, and increase accountability for land management practices if intensification of the cattle sector is to deter new deforestation and displace production from low-yield, extensive cattle production systems in frontier regions of the Brazilian Amazon.