Getting More `Carbon Bang' for Your `Buck' in Acre State, Brazil

30 Pages Posted: 31 Oct 2016

See all articles by Charles Palmer

Charles Palmer

London School of Economics & Political Science (LSE)

Luca Taschini

London School of Economics & Political Science (LSE) - Grantham Research Institute on Climate Change and the Environment; University of Verona - Department of Economics

Timothy Laing

London School of Economics & Political Science (LSE) - Grantham Research Institute on Climate Change and the Environment

Date Written: October 31, 2016

Abstract

Acre State in Brazil is at the forefront of efforts to institutionalize jurisdictional-scale policies that aim to reduce emissions from deforestation and forest degradation (REDD ). Given limited REDD funds and uncertain returns from alternative land uses, this paper estimates the minimum incentive payment Acre’s government would have to pay forest landowners in each of its 22 municipalities to ensure forest conservation. Despite low profits but with relatively low conversion costs and stable returns over time, pasture generates the highest returns in 19 municipalities. Municipalities are ranked according to their relative policy costs, a ranking which is compared to the distribution of forest carbon stocks across Acre. Finally, the relative cost per ton of carbon is derived, which enables the identification of a group of 13 municipalities with the greatest potential for ‘carbon bang’ for a given ‘buck’.

Keywords: Cost-effectiveness, Forest Conservation, Option Value, Payments for Environmental Services, Reducing Emissions from Deforestation and Degradation (REDD ), Uncertainty

JEL Classification: Q23, Q24

Suggested Citation

Palmer, Charles and Taschini, Luca and Laing, Timothy, Getting More `Carbon Bang' for Your `Buck' in Acre State, Brazil (October 31, 2016). Available at SSRN: https://ssrn.com/abstract=2861856 or http://dx.doi.org/10.2139/ssrn.2861856

Charles Palmer

London School of Economics & Political Science (LSE) ( email )

Houghton Street
London, WC2A 2AE
United Kingdom

Luca Taschini (Contact Author)

London School of Economics & Political Science (LSE) - Grantham Research Institute on Climate Change and the Environment ( email )

Houghton Street
London, WC2A 2AE
Great Britain

University of Verona - Department of Economics ( email )

Via Cantarane 24
Verona, Verona 37129
Italy

Timothy Laing

London School of Economics & Political Science (LSE) - Grantham Research Institute on Climate Change and the Environment ( email )

Houghton Street
London, WC2A 2AE
Great Britain

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
10
Abstract Views
127
PlumX Metrics