DP9394 Firewood Collections and Economic Growth in Rural Nepal 1995-2010: Evidence from a Household Panel

Author(s): Jean-Marie Baland, Francois Libois, Dilip Mookherjee
Publication Date: March 2013
Keyword(s): deforestation, Environmental Kuznets Curve, growth, Nepal
JEL(s): D12, O1, Q2
Programme Areas: Development Economics
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=9394

A household panel data set is used to investigate the effects of economic growth on firewood collection in Nepal between 1995 and 2010. Results from preceding cross-sectional analyses are found to be robust: (a) rising consumptions for all but the top decile were associated with increased firewood collections, contrary to the Poverty-Environment hypothesis; (b) sources of growth matter: increased livestock was associated with increased collections, and falling household size, increased education, non-farm business assets and road connectivity with reduced collections. Nepal households collected 25% less firewood over this period, mostly explained by falling livestock, and rising education, connectivity and out-migration.