World Bank lending and deforestation: A cross-national analysis

Abstract

The article presents a cross-national analysis that tests hypotheses drawn from dependency theory that poor nations undergoing World Bank investment and structural adjustment loans tend to have higher rates of deforestation than poor nations not undergoing these types of loans. In doing so, the article analyzes cross-national data for a sample of 61 nations from 1990 to 2005. The study finds substantial support for the dependency theory hypothesis. It also finds that a number of other factors help to explain deforestation. These include non-governmental organizations, democracy, agricultural and forestry-based economic activity, population growth, data quality and tropical climate. The article concludes with a discussion of the findings, methodological implications, policy suggestions and possible directions for future research.