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Seminario de Economía Regional y Políticas Públicas - The unintended environmetal effect of agriculture modernization: evidence for Colombian coffe sector
This paper analyzes the unintended environmental effect of modernization in agriculture using the case of the Colombian coffee sector. We focus on a renewal program that provided flexible loans conditional on the conversion of coffee crops production decisions system. We use a novel dataset that includes all of the production decisions of coffee growers from 2000 to 2014 matched with satellite forest cover data, to analyze the environmental effect of changes in crop production system. Our empirical strategy uses a Difference -in-Differences approach to compare the forest cover of farms before and after crop renewal. The results suggest that farms that renewed their crops lost larger forest areas than those that did not. Farms lost a forest area 29.26% of the mean farm size, while medium and large farms lost between 22.04% and 9.64%, each.