Relationship between Poverty and Deforestation in the Brazilian Amazon: An Empirical Study of the State of Pará

Abstract

The state of Pará, located in the so-called Brazilian Legal Amazon, is home to a significant portion of its population living in poverty. At the same time, its land use and occupation processes are dominated by economic activities considered key drivers of deforestation in the region. This article investigates the relationship between poverty and deforestation at the municipal level between the Agricultural Censuses from 2006 to 2017, using the number of families benefiting from the Income Transfer Program “Bolsa Família” as a proxy indicator of poverty. The analysis treats poverty and deforestation as endogenous and simultaneously determined, employing the Generalized Method of Moments in three stages. The main results point to an inverse relationship between poverty and deforestation, suggesting the viability of implementing policies in the region that simultaneously address both issues, challenging the idea of a trade-off between these dimensions of the Sustainable Development Goals.