Conference Agenda

Does industrial activity drive deforestation and land degradation, and can limited state capacity be overcome to decouple economic growth from environmental harm? We examine these questions in the context of slaughterhouse plant openings in Brazil from 1994 to 2019. Guided by a simple conceptual framework and using a staggered difference-in-differences approach, we show that plant openings increase livestock production while reducing forest cover and degrading pastureland. However, following the introduction of legally enforceable, incentive-compatible agreements between slaughterhouses and federal prosecutors—which penalize purchases of livestock from illegally deforested areas but act as a green certification mechanism—plant openings increase productivity without driving deforestation. Our findings suggest that tying firm performance to environmental goals through market-aligned legal mechanisms that are low-cost for the government can generate both economic and environmental gains.

This paper examines whether land certification enhances the effectiveness of reforestation programs. Specifically, we ask whether securing a land certificate (i) improves tree growth on reforested plots and (ii) affects associated socio-economic outcomes. We study the Programme de Lutte Anti-Érosive (PLAE), a smallholder forest restoration initiative implemented in northern and northwestern Madagascar between 2014 and 2019. Using primary household survey data combined with geospatial data, we employ a quasi-experimental strategy that leverages variation in the presence of overlapping historical colonial and post-colonial land titles, which continue to impede land formalization today. We find that successful land certification significantly increases tree growth and maintenance activities and reduces fire damage, consistent with enhanced investment incentives. However, certification also increases reported tree theft and has no detectable effect on perceived tenure security, charcoal-related income, or broader welfare outcomes. These findings highlight both the potential and the limitations of land rights formalization in weak institutional and market environments.

Spillover effects between regions are common in deforestation and environmental economics. Yet, data on the networks behind them is elusive, and empirical analyses rely on proxies and assumptions. In this paper, I present a hierarchical approach to jointly model spillovers and the latent networks driving them. I apply this approach to investigate the deforestation impact from blacklisting municipalities in the Brazilian Amazon. I find large positive spillovers from the intervention that are underestimated considerably when using conventional spatial proxies. Results further suggest that endogenous spillovers may lead to upward bias when assessing deforestation interventions. My approach is widely applicable, and its flexibility can improve our understanding of spillovers by revealing the networks behind them and enabling targeted, effective interventions.

The relationship between environmental regulation and firm productivity remains unsettled. Using a large-scale panel of EU firms spanning numerous sectors over 2013–2022, this paper examines how environmental policy stringency relates to firm-level productivity. Productivity is obtained from estimated production functions and linked to policy stringency, measured by the OECD Climate Actions and Policies Measurement Framework (CAPMF), in a dynamic distributed-lag panel framework. Stricter policy is not systematically associated with lower productivity. Estimated effects vary with policy scope and with how slow-moving country characteristics and macro-policy environments correlated with CAPMF are accounted for. Specifications that impose common policy coefficients across sectors and instruments yield small, often negative average associations, whereas richer conditioning attenuates these losses and can imply modest positive medium-run responses. Allowing for heterogeneity across instruments and sectors reveals pronounced differences in estimated effects. Market-based instruments are more likely to coincide with productivity gains than non-market measures, and sector-specific estimates show offsetting winners and losers across CAPMF components that aggregate models mask.