Making More Than a Market: Carbon Credits in the Western Brazilian Amazon

In the Brazilian state of Acre, government officials are innovatively using two new economic concepts—carbon credits and ecosystem services—to empower poor farmers and transform the state’s economy. Carbon credits—representing carbon emissions avoided by reducing the state’s projected deforestation rate—give financial value to forests traditionally only valuable when felled. In Acre, revenue from the sale of carbon credits does not compensate landowners for the opportunity costs of foregoing deforestation, as in other carbon credit projects. Instead, the government distributes carbon credit revenue mostly to poor farmers and traditional communities based on the idea that, because they do not deforest, they are providers of the ecosystem service of carbon sequestration. This inclusive approach to carbon credit production attempts to change how agriculture is practiced in Acre, supporting poor farmers to produce and sell forest-friendly products. Based on 18 months of fieldwork studying the everyday interactions between poor farmers, bureaucrats, and environmental entrepreneurs, my project addresses the social significance of carbon credits. Specifically I examine: (1) how the innovative use of the concept of “ecosystem services” makes carbon credit production more inclusive of poor farmers; (2) how carbon credits are used to support the development of an equitable “low-carbon” economy; and (3) how pro-poor carbon credits blur the boundary between markets and states. In so doing, my project contributes to our understanding of how new goods (carbon credits) and services (ecosystem services) are used in complex developing country contexts and how they can contribute toward more equitable and environmentally sustainable development.