An analysis of land conversion from sustainable forestry to pasture: a case study in the Bolivian Lowlands

The objective of this paper is to examine the land-use dynamics between cattle production and forestry: when forest production takes place in a sustainable manner and cattle production is without the benefit of artificial production incentives. Data from the Lowlands of Bolivia are used in the empirical analysis and although the results directly reflect that situation, they are pertinent to much of Latin America and the continuing land-use conflict between forestry and cattle production. The results suggest that contrary to conventional wisdom, higher stumpage values do not always lead to a decrease in the land converted to pasture. In circumstances where per hectare stumpage values are very low, increases in stumpage values will provide the capital required to convert land to pasture and thus exacerbate land conversion. This will occur until a certain threshold value, after which further increases in stumpage values will decrease land conversion to pasture, as would be expected.