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Stochastic food prices and slash-and-burn agriculture

Published online by Cambridge University Press:  02 April 2001

CHRISTOPHER B. BARRETT
CHRISTOPHER B. BARRETT
Affiliation:
Department of Agricultural, Resource, and Managerial Economics, Cornell University, 351 Warren Hall, Ithaca, NY 14853–7801 USA. Tel: (1-607) 255-4489, Fax: (1-607) 255-9984.
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Abstract

This paper explores the interrelationship between poverty, risk, and deforestation by small farmers in the low-income tropics. A nonseparable household model reveals how exogenous shocks to the mean or variance of a food price distribution might affect peasants' incentives to clear forest. The resulting links between food price policy, farmer behavior, and deforestation offer an innovative explanation of the vicious cycle of peasant immiserization and tropical deforestation. An intriguing, testable hypothesis also emerges: that market-oriented reforms that increase the mean and variance of food prices may inadvertently stimulate deforestation in economies in which a sizable proportion of farmers are net buyers.

Keywords

agricultural liberalizationdeforestationfood securityMadagascarnon-separable household modelingpeasant agricultureprice risk
Type
Research Article
Information
Environment and Development Economics , Volume 4 , Issue 2 , May 1999 , pp. 161 - 176
Copyright
© 1999 Cambridge University Press

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