“Land Sparing” in a von Thünen Framework: Theory and Evidence from Brazil

Abstract

This paper evaluates microscale evidence for “land sparing” in a von Thünen framework. A panel dataset of household lots in Rondônia, Brazil is used to test the hypothesis that the closer a household is to market the more likely it will adopt land-sparing patterns of cattle production in response to rising demand for beef and milk. Results from a fixed effects model suggest that, consistent with theory, pasture area declines and forest is spared in lots located closer to market. Other results differ, however, depending on forest type and commodity. Greater initial endowments of forest are associated with more deforestation. (JEL Q15, Q24)