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Deforestation, and the Incentivized Eco-Crime of Indonesia

There are books that governments keep officially, and then there are the other books – accounts of what people are actually doing and profiting from that are never mentioned in any legal context. A team of researchers from MIT, the University of Maryland, the London School of Economics and the World Bank cleverly used MODIS satellite imagery to uncover this kind of discrepancy as they investigated deforestation in Indonesia.

The satellite pictures allowed for comparison of legal and illegal logging operations. What they found (and write about in a new paper for NBER) shows how an increasingly decentralized government, coupled with very real monetary incentives for local officials, leads to eco-crime.

Indonesia contains one of the largest pieces of tropical forest in the world, rivaled only by Brazil and the Democratic Republic of the Congo. It’s also the third largest producer of greenhouse gases behind the U.S. and China, due largely to its “forest extraction” practices. The paper examines three main forces that affect the decision-making and corruption of bureaucrats and government officials in charge of the logging-heavy jurisdictions of Indonesia. Read More »