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Abstract
Over the last years,concerns about the possibility that the economic growth
may cause deforestation in the Amazon region have been increasing.This work is
aimed at studying the relation between income and deforestation by the hypothesis
of Environmental Kuznets Curve (EKC) approach at municipal level in the period
from2001-2006. A panel data model with spatial dependence was estimated. Some other
variables mentioned in the literature as important causes of deforestation (cattle and
agricultural activities, population density and others) were included. The best model
specified is the one that includes a spatial error term and spatial spillovers. The relation
founded is not the traditional inverted “U” shaped, but an inverted “N” shaped relation.