The super-rich and cropland expansion via direct investments in agriculture

Cropland expansion represents an important cause of tropical
deforestation, contributing to the loss of ecosystems’ functions.
Flex-crops (e.g., oil palm, soy, sugar cane) account for an increasing
share of cropland and contribute significantly to carbon emissions and
biodiversity loss. Various forms of inequality have been shown to impact
on agricultural expansion, yet the effect of wealth concentration among
the super-rich is understudied. Here I show how, over the period
1991-2014, the large amount of wealth in the hands of high net worth
individuals (HNWI) stimulated foreign direct investments in agriculture in
Latin America and South-East Asia. This, in turn, drove the expansion of
flex-crops areas. The combination of these two effects implies that, a 1%
increase in the wealth of HNWI generated an expansion of the flex-crops
area share of up to 2.4-10%. The results point to the urgency of
addressing wealth inequality to protect the remaining forests.