Testing Kuznets’ environmental hypothesis for the Legal Amazon: a nonlinear approach

Abstract This study tests the null hypothesis that no significant differences exist in the relationship between economic growth and deforestation, based on the levels of growth and agricultural productivity in the municipalities of the Brazilian Legal Amazon. Grounded in the environmental Kuznets curve theory, this study employs a non-linear methodological approach to estimate the relationship between economic growth and deforestation. The results reject the null hypothesis, indicating that the relationship between growth and deforestation varies with the municipalities’ productive performance. Furthermore, the findings conclude that a negative monotonic relationship exists between economic growth and deforestation in the Brazilian Legal Amazon, suggesting that reductions in deforestation are achievable even during periods of economic expansion.