are several limitations associated with this ap- proach, however. The first obstacle is a practical
one. Many of the relevant studies conducted at scientific stations in Bolivia, Peru, and Brazil in
Spanish and Portuguese have never been pub- lished in the U.S.
5
Second, since these studies use very specific crop varieties and agricultural tech-
nologies such a meta-analysis would require a careful pooling methodology and special technical
knowledge. In addition, the rate of land degrada- tion thus calculated may or may not reflect actual
rates of land degradation faced by common agri- culturists following normal patterns of land use in
the Amazon.
This paper provides an alternative measure of the rate of agricultural productivity decline that
can be estimated from less specific data that is more widely available. We do not intend the
proposed methodology to serve as a substitute for careful field analysis, but rather as a complemen-
tary form of analysis. As we shall discuss, our approach lacks the ability that field studies have
to provide advice on optimal cropping patterns, for example on how to improve productivity.
However it does have the advantage of being a more general, average measure that is relatively
easier to compute.
The paper continues as follows. Section 2 pro- vides a very brief history of agricultural policy in
the Amazon. Section 3 describes the data set and outlines the basic procedure to calculate the rate
of degradation. Section 4 discusses some specific estimation and data issues and presents the main
results.
Finally, Section
5 summarizes
the conclusions.
2. A brief economic history of agriculture in the Amazon
As documented in the literature
6
it is generally accepted that the initial, primary causes of human
incursions into the Brazilian Amazon were gov- ernmental policies that encouraged settlement and
land clearing. Although these policies began in 1958 with the opening of the Brasilia – Belem high-
way, settlement and the consequent deforestation was minimal until the mid 1970s when the govern-
ment embarked on a more aggressive pro-settle- ment program designed to increase population of
the interior. Amazonian settlers cleared forest to gain title to the land, generally practicing small
scale shifting agriculture or low-quality cattle ranching.
7
Fiscal incentives insured that many economic activities with low or even negative
economic rates of return would be profitable, leading to excessive investment in clearing land.
Road building on the part of the government and timber companies opened up new tracts of land to
the agriculturists.
As the frontier moved further and further into the interior, a typical pattern of land use emerged.
This began with land clearing by timber compa- nies, followed by the arrival of colonists attracted
by the easy availability of cheap land. These early colonists generally practiced shifting cultivation,
leaving the land fallow and moving on to clear new land after the land was exhausted usually
3 – 4 years. As the frontier progressed outward, these early settlers found themselves surrounded
by improved rural infrastructures or even urban centers with the value of their land correspond-
ingly higher. At that point many colonists sold their plots to second-wave colonists, usually cattle
ranchers or capital-intensive agricultural enter- prises. The first-wave colonists then moved on to
the new frontier of newly cleared forest to begin the sequence anew, leaving the better-endowed
second wave colonists to more intensively work the older lands Andersen et al., 1996.
Considerable international pressure since 1992 has led to the removal or even reversal of many of
the policies that had encouraged land clearing and settlement in the 1970s and 1980s see Andersen et
al., 1996. Indeed, deforestation slowed consider- ably between 1985 and 1994, although many ob-
servers attribute this change more to the economic recession and hyperinflation than to changing
5
The author has only indirectly heard of the existence of these studies through informal conversations with scientists
who have spent time in the Amazon region.
6
See, for example, Mahar 1989, Schneider 1992 or Binswanger 1991.
7
Mahar 1989, Schneider 1992.
government policies Moran, 1993. With a suc- cessful stabilization program now beginning to
bear economic fruit in Brazil, figures for 1995 and 1996 reveal an alarming increase in deforestation
rates.
8
Indeed, currently 16 million people live and work in legal Amazonia, with over 1.4 million
living in the city of Manaus Andersen et al., 1996. The process of deforestation has, in a
sense, taken on a life of its own responding to local and national economic forces of population
growth, landlessness, and the need for producer and household goods, food and building supplies.
Despite recent national ‘environmentally friendly’ legislation, further land clearing and local road
building occurs due to these endogenous eco- nomic pressures. The co-movement of deforesta-
tion
and national
economic performance
underlines this point: the process of environmen- tal degradation may no longer respond primarily
to changes in national land policy although these are certainly important but rather is part of the
complex interaction of the local and national economies.
While it is beyond the scope of this paper to elucidate the complexities of this relationship, we
do believe that a necessary ingredient of a dy- namic, macroeconomic model of the economics of
deforestation is some aggregate parameter esti- mate of how crop land degrades over time. The
methodology described below is presented as an alternative form to estimate this parameter.
3. Methodology
