Document Type

Honors Project

Publication Date

6-1-2016

Abstract

Haiti and the Dominican Republic share the island of Hispaniola, yet since the 1950s, the two nations have experienced divergent economic and environmental trajectories. The cause of these nations' economic and environmental divergence has been widely studied; however, I take an institutional approach in my analysis informed by a vast body of literature concerning institutions, economic development, and natural resource usage. In this analysis, I attempt to identify determinants of modern forest management practices in Haiti and the Dominican Republic and discuss factors that may have influenced institutional quality in the two countries. I argue that Haiti's extractive institutions promoted higher forest extraction rates, a result that is consistent with institutional theories concerning natural resource use. However, the Dominican Republic complicates these theoretical predictions, as Dominican forest cover increased under an extractive regime. I then estimate empirically the effects of institutional quality on forest usage across countries, comparing my findings to the case of Haiti and the Dominican Republic. Following Acemoglu, Johnson, and Robinson's seminal research on institutions and economic development (2001), I instrument for institutional quality using the mortality rates of colonial settlers in order to mitigate potential endogeneity problems between institutional quality and forest extraction rates. In my empirical study, I find that higher institutional quality, on average, promotes the sustainable usage of forest management practices, which is consistent with the institutional literature.

Level of Honors

summa cum laude

Department

Economics

Advisor

David Gerard and Jonathan Lhost

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