E-IPER Dissertation Defense: Rachael Garrett
Interactions between global supply chains, land use, and governance: the case of soybean production in South America
Rapid growth in global soybean demand has had a profound impact on land cover in South America over the last three decades, contributing to a 30 million hectare increase in soybean planted area during this period. Much of this new soybean area came at the expense of native vegetation in the Amazon, Cerrado, and Chaco forests and savannas. The goal of my dissertation is to integrate theories from agricultural economics, land change science, and economic geography to better understand the economic and institutional mechanisms that influence the location and impact of soybean production in South America at multiple scales. In particular, I aim to: i) link changes in international demand, consumer preferences, and macroeconomic conditions to local changes in soybean area in South America through the study of soybean supply chains, and ii) understand how supply chains create or enforce land use institutions and market mechanisms.
I show that a country’s use of GM soybean technology influences how competitive that country is in foreign soybean markets. Trade relationships, in turn, interact with supply chain configurations to mediate producers’ exposure to consumer preferences in importing countries and opportunities to tap into additional niche markets for environmentally responsible soybeans. This cyclical feedback between trade relationships and land use helps determine the overall environmental impact of soybean production in a particular country. I also find that differences in land tenure and environmental institutions in the Brazilian Cerrado and Amazon influence the development of agglomeration economies in soybean production. Where agglomeration economies occur, they act to create positive externalities related to prices, information, and access to resources for farmers, which increases the total factor productivity and local profitability of agriculture. The organization of the supply chain in each county, in turn, influences the enforcement of environmental regulations through the type of actors being involved and their sustainability commitments.