| dc.description.abstract | This study explores the impact of institutional quality at the municipal level on deforestation in
the Legal Amazon. We add to this insufficiently understood topic by implementing a geographic
regression discontinuity design. By taking advantage of high-resolution spatial data on
deforestation combined with an objective measure of corruption used as a proxy for institutional
quality, we analyse 138 Brazilian municipalities in the period of 2002-2004. Our empirical
findings show no causal effect of institutional quality on deforestation, suggesting that other
unobserved factors are more important drivers of deforestation. A supplementary analysis
indicates that location is a vital underlying factor in the interplay between deforestation and
institutional quality. However, further research is needed to establish inference with respect to the
relationship between deforestation, institutional quality and location. | nb_NO |
