The COVID-19 pandemic and government responses led to a halt in economic activity. While this reduced pollution in urban areas, its effect on deforestation in areas outside of cities is unclear. Deforestation may have decreased due to the restrictions on economic activity, but, it may have increased due to the drying up of alternative income sources. We analyzed bi-weekly data on tropical forests worldwide in relation to the dates when different countries implemented lockdown restrictions. Our analysis found that while lockdowns did reduce mobility in forest municipalities, the average effect on deforestation was not significant. However, we did observe variations in the impact of lockdowns on deforestation based on the share of lockdown-vulnerable GDP and the level of government effectiveness. These results stand across tropical countries and within Colombia. These findings highlight the importance of alternative income sources and strong state capacity for effective policies aimed at reducing deforestation.

The literature on the impacts of transport corridors points to a tradeoff between income and environmental quality. We estimate the impacts of India's Golden Quadrilateral and North-South-East-West highways on income and environmental quality to test this tradeoff hypothesis. Applying the difference-in-difference method to district level data, we find that the highways increased both local income and particulate matter air pollution. The estimated increase in air pollution is robust to using an instrumental variables approach, while that in income is not. Examining heterogeneity in these impacts, we find that the income–environment tradeoff was less steep in districts with initially higher educational attainment rates because they experienced a smaller increase in air pollution due to the highways.

The purpose of this paper is to analyse the effects of natural resources on income inequality conditional on economic complexity in 111 developed and developing countries from 1995 to 2016. The system-GMM results show that economic complexity reverses the positive effects of natural resource dependence on income inequality. Furthermore, results are robust to the distinction between dependence on point resources (fossil fuels, ores, and metals), dependence on diffuse resources (agricultural raw material), and resource abundance. Finally, there are significant differences between countries, depending on the level of ethnic fragmentation and democracy.

The presence of monitoring institutions affects quality and effort of leaders. We investigate the effect of intensified monitoring on the ability and effort of leaders for a sample of forest user groups in Ethiopia, and find experimental and non-experimental evidence of an important trade-off: monitoring increases leaders' effort but lowers their quality in terms of education and experience. This effort–ability trade-off only occurs in the presence of alternative income opportunities (affecting the opportunity cost of time) and only among a subsample of leaders with low prosocial motivation. For our context, we document that the net effect of monitoring on economic outcomes is positive.