The Price of the Amazon Rainforest

<p> One proposed method for <a class="wikilink" href="/mitigation_of_climate_change/"> mitigation of climate change </a> is <a class="wikilink" href="/reforestation/"> reforestation </a> . However, any effort is futile if we don't stop first the <a class="wikilink" href="/deforestation/"> deforestation </a> . The <a class="wikilink" href="/amazon_rainforest/"> Amazon Rainforest </a> sits 2/3 in just one country: <a class="wikilink" href="/brazil/"> Brazil </a> . Is it possible, therefore, to incentivize Brazilians to stop deforesting for cattle and other economical activities in order to preserve what is left? </p> <p> The free-market approach to any problem is throwing money at it. How much would a farmer/rancher need to keep the trees. The simple math would be: how much money does a rancher make a year per hectare and pay them that. It's free money in exchange of no work, so it seems to compensate <sup id="fnref:1"> <a class="footnote-ref" href="#fn:1"> 1 </a> </sup> . This math would give Brazil around 1 or 2 billion dollars a year. </p> <p> Now, if Brazil produces less food, overall food prices will go up, benefiting farmers in other countries. Are, therefore, values set for the Amazon farmers constantly updating to, say, US farmer rates? </p> <p> <strong> Who pays for it? </strong> </p> <p> However, the value of the Amazon is not just for the money it makes, it's also for the <a class="wikilink" href="/carbon/"> carbon </a> it holds. If we put a price on <a class="wikilink" href="/carbon_emissions/"> carbon emissions </a> , the Amazon would have a negative impact and thus the math is very different. The Brazilian government estimates between 10 and 20 billion dollars a year. In such situation, who pays is clearer: whoever emits pays whoever has a negative offset. But this <a class="wikilink" href="/carbon_tax/"> carbon tax </a> has proven to be very elusive in recent years. </p> <div class="footnote"> <hr/> <ol> <li id="fn:1"> <p> <a href="https://freakonomics.com/podcast/amazon-rain-forest/"> Freakonomics </a> <a class="wikilink" href="/podcast/"> podcast </a> <a class="footnote-backref" href="#fnref:1" title="Jump back to footnote 1 in the text"> ↩ </a> </p> </li> </ol> </div>