ENVIRONMENTAL KUZNETS CURVE FOR THE MATO GROSSO STATE

Abstract

Issues concerning deforestation have become a crucial theme in the environmental world debate. In this picture, Mato Grosso State has become an unfavorable example because it represents 36% of the accumulated deforestation in the Brazilian Amazon. In order to investigate the relationship between deforestation and income growth, this paper estimates an Environmental Kuznets Curve (EKC) for 139 cities of Mato Grosso through spatial econometrics. Using data for the year 2006, we estimate an EKC for the deforestation per capita against income per capita and other variables controlling the spatial effects. The preliminary results indicate that an EKC exists in a reversed U shape, i. e., the income growth reduces environmental effects from the maximum point. However, introducing a cubic term for the income, the economic growth would not reveal any relationship with the deforestation in the Mato Grosso State.