Does Improved Governance Contribute to Sustainable Forest Management?

Abstract

Abstract This paper explores the hypothesis that improving governance is beneficial in reducing deforestation. The hypothesis is tested by including six objectively constructed measures of governance as explanatory variables in an econometric model of the causes of deforestation. Analysis of cross-section data for 90 countries shows an indirect but strong impact of governance on deforestation, working through per capita income. However, the evidence to support a direct beneficial impact of improved governance on deforestation is quite weak. The paper argues that if the main objective is to reduce deforestation-especially in the short run-then undertaking reforms directly related to the forest sector, such as in the areas of forest policy, scientific forest management, and forest law enforcement and compliance are likely to be the most effective both in terms of cost and outcomes. However, improving overall governance should not be ignored as it is likely to yield long term benefits including enhanced effectiveness of reforms within the forestry sector.