Off-farm employment, forest clearing and natural resource use: Evidence from the Ecuadorian Amazon

Abstract

Off-farm employment in rural households has been cited in the literature as a potentially ideal alternative to reduce forest clearing and pressure on natural resources, since it provides income while at the same time taking household labor away from the farm. Nonetheless, empirical research on the relationship between off-farm work and natural resource use is still scarce. This paper examines the impact of off-farm work on forest clearing, logging, hunting, and fishing among both migrant colonists and indigenous populations in the Ecuadorian Amazon. In contrast to prior research, we use an instrumental variable approach to control for the potential endogeneity of off-farm work with respect to natural resource use. The results indicate that the higher the number of days worked off-farm at the household level, the lower the forest clearing. On the other hand, the number of days worked off-farm has no effect on logging, hunting, and fishing. The implications of this for sustainable development and conservation are explored in the conclusion section.