How does corruption drive illegal deforestation in Amazon Forest?

Authors

  • Cassandro Maria da Veiga Mendes Universidade Federal do Rio Grande do Sul

Abstract

The resent policy imposes heavier penalties and closer surveillance to individuals engaged in illegal deforestation. This paper disputes the alleged effects of this policy. A new variable is added to the problem, the corrupt behavior. An analysis is made of how information asymmetry between the government and the official in charge of inspection may affect deforestation. By using Agency Theory, a simultaneous static game of complete/perfect information between the landowner and the official is simulated. Then, the resulting Nash equilibrium is analyzed. Results show that the actual relationship between the government and the Brazilian Institute for Environment and Natural Resources officials (IBAMA) promote incentive do collusion. Also, the results shown that a policy oriented, only, to surveillance of landowners is a necessary but not sufficient condition to guarantee the conservation of the Amazon rainforest. Also, harsher policies may lead up, in some cases, to increased illegal deforestation.

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Published

2013-07-30

Issue

Vol. 9 No. 2 (2009)

Section

Artigos

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