Forest scarcity does not slow tropical deforestation

Tropical moist forests are vital for biodiversity, climate regulation, and human livelihoods,
yet they continue to decline at alarming rates. Standards theories in environmental
economics and the forest-transition framework posit that as forests become scarce, rising
scarcity should eventually slow deforestation, a transition similar to that observed in
developed countries. This paper tests whether such a transition is emerging in tropical
countries.
Using a new high-resolution, satellite-based dataset covering 52 tropical countries from
1990 to 2021, which distinguishes between deforestation and degradation occurring in
either undisturbed or already degraded forests, we document the relationship between
forest scarcity and forest loss at country level. We combine these detailed data with a
System-GMM estimator augmented with Common Correlated Effects to control for weak
exogeneity, unobserved heterogeneity, and cross-sectional dependence.
Contrary to previous findings, we find that forest scarcity accelerates rather than slows
tropical forest loss, especially in the form of deforestation. The effect is strongest in Africa,
and greater institutional capacity does not prevent the acceleration of forest loss. These
results challenge the idea that scarcity alone can trigger conservation, and instead highlight
the risk of depletion as observed for common-pool resources. Effective conservation
must therefore go beyond enforcement to increase the relative value of standing forests
through ecosystem service compensation, sustainable use, or agroforestry integration.