Deforestation, agricultural expansion and agricultural productivity in tropical Latin America: is there a Jevons paradox?

The process of global deforestation calls for urgent attention, particularly in South America where deforestation rates have failed to decline over the past 20 years. The main direct cause of deforestation is land conversion to agriculture, while the underlying drivers include economic growth, population growth and other technological and institutional factors.
As world population is expected to reach 9 billion by 2050, the scientific and policy communities are placing significant emphasis on technological
innovation and agricultural intensification in order to address the food security issue without further impactingon existing forests. In this article we combine data from the FAO and the World Bank for 7
Southern American countries over the period 1970 - 2006 estimate an econometric model which accounts for various determinants of agricultural land expansion and use elasticities to quantify the effect of the different independent variables. In particular we investigate whether, after accounting for various socio-economic factors and corruption control, an increase in agricultural productivity behaves unexpectedly by strengthening the incentives to expand agricultural area, therefore leading to a “Jevons paradox”. Our results show that when corruption control is strong a Jevons paradox begins to emerge
for high levels of agricultural productivity. We also find that agricultural expansion is positively related to the level of service on external debt, agricultural exports and population growth. Finally, the Environmental Kuznets Curve hypothesis for agricultural area, suggesting that GDP growth initially
promotes agricultural expansion but ultimately leads to a reduction in agricultural land, is not supported by the data. Instead the effect of per-capita GDP on agricultural land is highly non-linear but ultimately
leads to an increase in agricultural area.