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Land Reform Policies, The Sources of Violent Conflict and Implications for Deforestation in the Brazilian Amazon Lee J. Alston University of Illinois NBER.

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Presentation on theme: "Land Reform Policies, The Sources of Violent Conflict and Implications for Deforestation in the Brazilian Amazon Lee J. Alston University of Illinois NBER."— Presentation transcript:

1 Land Reform Policies, The Sources of Violent Conflict and Implications for Deforestation in the Brazilian Amazon Lee J. Alston University of Illinois NBER Gary D. Libecap University of Arizona NBER Bernardo Mueller Universidade de Brasilia

2 I - Purpose of the Paper Develop and Test a Theoretical Framework for Land Conflict in the Brazilian Amazon.

3 II - Importance: 1.Lives Lost – Over the past two decades more than 500 people killed in disputes over land in the Amazon. 2.Violence – by weakening property rights may reduce investment and thereby economic growth. 3.Dissipation of Resources through Offensive and Defensive Strategies – Deforestation.

4 People Population of Pará Ministério do Desenvolvimento Agrário, Balanço das Ações no Sul e Sudeste do Pará. Source: Ministério do Desenvolvimento Agrário, Balanço das Ações no Sul e Sudeste do Pará. 1.041.986 5.510.849 1.185.065 6.188.685 0 1.000.000 2.000.000 3.000.000 4.000.000 5.000.000 6.000.000 7.000.000 192019301940195019601970198019902000 Southeast ParáPará

5 Land Reform Settlements in Pará Ministério do Desenvolvimento Agrário, Balanço das Ações no Sul e Sudeste do Pará. Source: Ministério do Desenvolvimento Agrário, Balanço das Ações no Sul e Sudeste do Pará.

6 YearCredit for Installation (R$) Credit for Infrastructure (R$) 19963,207,300 563,362 199711,536,700 14,924,851 199824,788,925 21,898,420 199917,499,800 15,889,426 200019,383,000 12,160,000 Total76,415,725 65,436,059 Land Reform Credit in Pará Ministério do Desenvolvimento Agrário, Balanço das Ações no Sul e Sudeste do Pará. Source: Ministério do Desenvolvimento Agrário, Balanço das Ações no Sul e Sudeste do Pará.

7 Land Invasions in Pará Ministério do Desenvolvimento Agrário, Balanço das Ações no Sul e Sudeste do Pará. Source: Ministério do Desenvolvimento Agrário, Balanço das Ações no Sul e Sudeste do Pará.

8 Numer of Families Settled - Brazil Source: INCRA, 2001, Balanço da Reforma Agrária.

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10 Assassination of Rural Workers – Brazil 1964-2001

11 Source: INPE, Monitoramento da Floresta Amazônica Brasileira por Satélite. 0.48% 0.30% 0.37% 0.40% 0.81% 0.51% 037% 0.54% 0.48% 0.37% Percentages are mean rates of gross deforestation (%year) relative to remaining forest.

12 Arch of Deforestation Increments of Deforestation Observed in 1998 Source: INPE, Monitoramento da Floresta Amazônica Brasileira por Satélite.

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14 Distribution of Mean Rate of Deforestation by size of deforested plot

15 III - Competing Property Rights: Titleholders versus Squatters 1.Property Rights of Titleholders- Statutory Law (upheld by local courts).

16 III - Competing Property Rights: Titleholders versus Squatters 2.Property Rights of Squatters – Constitution (upheld by INCRA). i.Expropriation of land titled land if it is not in socially beneficial use. ii.Right to occupy unproductive land. iii.If occupancy is not contested after five years, the right to a title. iv.Payment for Improvements

17 III - Competing Property Rights: Titleholders versus Squatters 3.No Respected Legal Hierarchy of Rights.

18 III - Competing Property Rights: Titleholders versus Squatters 4.Conflict not ubiquitous: i.much titled land is put into productive use. ii.property rights are not worth enforcing privately on much titled land. iii.titleholders pay squatters for improvements and leave when asked to leave.

19 IV - Institutional Environment: INCRA and the Courts 1.Courts: i.Local Courts issue eviction notices based on Civil Code. ii.Federal Courts rule on legality and value of expropriated land based on interpretation of socially beneficial use.

20 IV - Institutional Environment: INCRA and the Courts 2.INCRA: authority to expropriate land that is not fulfilling the socially beneficial use criterion. Probability of INCRA expropriating land determined by: i.s, the amount of violence by squatters (+) ii.P, the quality of property rights on occupied land (-) iii.G, the Presidents Commitment to land reform (+)

21 V - A Model of Rural Conflicts in the Amazon 1.Players: Titleholders and Squatters decide on how much effort (violence) to exert so as to maximize the payoff- the expected value of land.

22 V - A Model of Rural Conflicts in the Amazon 2.Value of Land depends on the outcome: i. Squatters evicted and farmer retains the land. ii.Squatters not evicted but the land is not expropriated (stalemate). iii.Land is expropriated.

23 V - A Model of Rural Conflicts in the Amazon 3.Squatter and Farmers Objective Functions: land values in each outcome are weighted by the probability of that outcome minus the costs of violence. The usual maximization, i.e., MB=MC.

24 V - A Model of Rural Conflicts in the Amazon 4.Joint Solution of optimizations – simultaneous optimization of v* (effort of titleholder) and s* (effort of squatters). s v squatters reaction function titleholders reaction function v*v* s*s*

25 V - A Model of Rural Conflicts in the Amazon 4.v* and s* will vary with: v.quality of property rights; v* (-), s* ( ) vi.position of the courts; v* ( ), s* (+) vii.federal governments will to expropriate; v* ( ), s* (+) viii.value of land; v* (+), s* ( ) ix.squatters cost; ; v* (-), s* (-) x.farmers cost; v* (-), s* (+)

26 VI - Estimation of the Determinants of Conflict Conflicts i (1991-1994) = B 0 + B 1 Settlements i + B 2 Squatting i + B 3 Clearing i + B 4 Concentration i + B 5 Value i + B 6 Establishments i + e Data: at the município (county) level for the state of Pará. Estimation: Tobit with 83 observations.

27 VI - Estimation of the Determinants of Conflict Land Conflicts Notes: Tobit estimation; t-statistics in parenthesis; N=83 Level of significance (Wald Chi-square statistic): 1% ***, 5% **, 10% * The coefficients presented are the regression (non-normalized) coefficients. Our estimation used instruments to estimate settlement in order to control of simultaneity. Constant-11.16** (-2.46) Settlements 2.90** (3.27) Squatting9.66* (1.95) Clear -6.92 (-1.45) Concentration 6.01* (1.91) Land Value 2.01** (2.23) Sigma 4.887 Establishments-0.0001 (-0.36) Wald Chi- Square Stat. ( 2 6, 1% = 16.81) 51.36*** Variable Est. Coef. Notes: Level of significance (Wald Chi- square statistic): 1% ***, 5% **, 10% * The coefficients presented are the regression (non-normalized) coefficients. Our estimation used instruments to estimate settlement in order to control of simultaneity.

28 Concluding Remarks 1.In their effort to promote land reform through expropriations and settlements the government is most likely increasing the number of land conflicts. 2.Using cleared land as a measure of beneficial or productive use leads to premature deforestation in an effort to solidify property rights.

29 Concluding Remarks 3.Underlying tension between efficiency gains from secure property rights and distributional objectives of land reform.

30 Concluding Remarks 4.Recent developments: i.Number of invasions falling. ii.Pressure is now mainly for credit. iii.Conflict prevention offices. iv.Conflict hot-line. v.Areas with more than 50% in forest are not susceptible to expropriation. vi.Land Bank.


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