Causes of Deforestation: Evidence from Top Deforested Countries

Abstract

This study investigates the causes of deforestation using panel data for top deforested countries from 1995 to 2022. We apply Panel Corrected Standard Error (PCSE) technique. The findings affirm that urbanization and water stress has negative and significant effect on deforestation and unemployment and agricultural exports have positive and significant effect on deforestation. The results of this study serve as the basis for the recommendations presented in the present research strategy such as labour opportunity cost might be increased to reduce agricultural rent. Stabilization and regeneration of the forest cover should be prompted by a greater demand for and a restricted supply of forest products. Labour opportunity cost should be increased to reduce agricultural rent. Stabilization and regeneration of the forest cover should be prompted by a greater demand for and a restricted supply of forest products.