Annual World Bank Conference on Land and Poverty 2013

LANDOWNERSHIP AS A DETERMINAT OF POVERTY IN THE AMAZON REGION: A STUDY CASE

BASED ON THE STATE OF ACRE

Paper prepared for presentation at the

“ANNUAL WORLD BANK CONFERENCE ON LAND AND POVERTY” The World Bank - Washington DC, April 8-11, 2013

Copyright 2013 by author(s). All rights reserved. Readers may make verbatim copies of this document for non-

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LANDOWNERSHIP AS A DETERMINAT OF POVERTY IN THE AMAZON REGION: A STUDY CASE

BASED ON THE STATE OF ACRE

REYDON, Bastiaan Philip1

MAIA, Alexandre Gori2

MACIEL, Raimundo Cláudio Gomes3

SOUZA, Gisele Elaine de Araújo Batista4

Abstract

The policies for the Amazonian occupation and development implemented by the Brazilian Federal Government in

the late 1960s, replaced the region specific development based on products extracted from the Rain Forest and by the

large agriculture and cattle projects. Its main results were: disarticulation of forest products extraction, destruction of

large amount natural forests and dislocation of the “people from the forests” to the outskirts of cities. To minimize such

conflicts, during the 70s and 80s, the federal government created the colonization projects, PAD’s and PAE's. In the 90s

as a result of the social conflicts the RESEX´s - protected areas for sustainable use were created. These different types of

access to land implies in different land use forms, different levels of monetary gains and of wellbeing. This article based

on data from rural households from three regions in the state of Acre, in the period 1996/1997 to 2006/2007 analyzes the

different socioeconomic and environmental conditions, given the kinds of access to land and types of governance

resources (land/environment). What can be generalized is that the level of guaranty associated to land ownership and

organization of the farmers played an important role in their wealth situation.

Key Words – land ownership, land governance, poverty, wealth, Amazon region, traditional populations.

1. INTRODUCTION

The economic history of the formation of the Amazon, especially in Acre, is directly related to so-called rubber

boom, which according Martinello (1985) "was undoubtedly [...] the socio-economic phenomenon that took place more

expressive Amazon "(p.23), in the late nineteenth and early twentieth centuries. In its initial stage, the operation gomífera

experienced intense expansion, in view of the growing demand of rubber in international trade, since this product had

become a raw material for wide applications in industry, being, also an important component of automobile industry. This

event led to a very large economic growth in the Amazon region (SILVA, 1990; Martinello, 1985).

However, after the rubber growing the introduction in Malaysia rubber has been produced with better quality and

lower cost than the native Hevea. Thus, from 1913, the Amazon rubber extraction plant lost its position in international

trade, with its production surpassed by that obtained in the plantations of the East (Duarte, 1987; SILVA, 1990).

1 Economist (USP), Master in Agronomy (USP), Doctor in Economical Development (IE/UNICAMP), Powder- by the University of Wisconsin -

Madison, Free Teacher of the Institute of Economy of the State University of Campinas. Email:basrey@eco.unicamp.br

2 Statistical (UNICAMP), Master in Economical Development (IE/UNICAMP), Doctor in Applied Economy (IE/UNICAMP), Powder-doctorate

in Latin-American Studies for the University of Texas attn Austin and in Geography (USP), Teacher Doutor of the Institute of Economy of the

State University of Campinas. Email: gori@eco.unicamp.br 3 Economist (UFAC), Master in Economical Development (IE/UNICAMP), Doctor in Applied Economy (IE/UNICAMP), Free Teacher of the

Department of Economy of the Federal University of Acre, Coordinator of the Project Economical Analysis of Basic Systems of the Rural

Family Production in the State of Acre (ASPF)/UFAC. Email: rcgmaciel@bol.com.br 4 Economist (UFAC), Master in Rural Extension (UFV), Student of the Doctorate in Economical Development (IE/UNICAMP). Email:

gigi_acre@yahoo.com.br

Only with the outbreak of World War II, in the period 1942/1945, that the production of native Amazon was

contacted again, since the Asian rubber cultivation had been invaded by the Japanese, suddenly interrupting the supply of

rubber to the United States that were forced to seek alternative sources of supply. However, the end of the Great War in

1945, the natural production was once again abandoned to their fate (Duarte, 1987).

The period after the war until the end of the 60s of the twentieth century, the extractive economy faced one of its

worst crises, reinforced by the gradual replacement of rubber imported by domestic plant and the national synthetic.

(Rego, 2002). But it was with the installation of the Military Government in 1964, the national crop production suffered

the hardest blow, because the economic policy set for the country not favored over the exploitation of rubber (SON

COSTA, 1995).

In the case of Amazon, the blow was even harder, because the policies of occupation and development,

implemented by the Federal Government in the late 60s, relegated the specifics of a region with an economy rooted

purely extractive base and encouraged the installation large agricultural projects, resulting in dislocation of the extraction

plant rubber, the destruction of vast areas of forest and the expulsion of families of rubber tappers to the outskirts of cities,

especially to Rio Branco, dilating pockets of poverty in the capital of Acre (SILVA , 1990).

In this context, the land that once guaranteed the survival of the community extraction becomes the object of lust

by big businessmen, squatters and speculators, going to be used primarily as a store of value. The socioeconomic and

environmental impacts caused aroused great feeling of revolt among rubber workers who remained in the rubber,

recognized as autonomous, resulting in the emergence of social conflicts between them and the ranchers (SILVA, 1990).

To minimize such conflicts, from the 70s and 80s, the federal government created official colonization, such as the

creation of Settlement Projects Addressed (DBP's), Agroextrativista Settlement Projects (PAE's) and in 1990 , regulated

the establishment of protected areas for sustainable use, such as extractive reserves, which became for many, not only

alternatives to mitigate the problem of land concentration, but also the rational exploitation of natural resources, and,

therefore immediately linked to the recent discussion on sustainable development and referenced by many scholars as the

new development paradigm for the Amazon region (Duarte, 1987; SOUZA, 2010).

Although the institution of settlement projects and conservation units of sustainable use has minimized the problem

of land in the Amazonian, numerous studies point to the difficulties of maintenance and social reproduction of families

living there and thus to the viability of these socioeconomic and environmental arrangements for land access.

These types of difficulties occurred in the past 15 years, in research conducted by the Project Economic Analysis of

Production Systems Basic Rural Family in Acre (ASPF), coordinated by the Department of Economics, Federal

University of Acre (UFAC). They showed not only the problem of economic feasibility of production units and therefore

the ability to generate income for the families, but also the weaknesses of health conditions, access to education, access to

professional knowledge, access working conditions of child development, housing conditions and environmental

conditions (MACIEL, 2011).

However, it is important to note that the rural Amazonian universe, particularly of Acre, involves very

heterogeneous populations (tappers, settlers, riparian, etc..), With its specific productive, social, and cultural interaction

with the environment, which depending on the type of access to land (ownership, agricultural settlements and extractive

reserves) and the pattern of governance established (land and environmental), may translate into different situations of

poverty and socioeconomic conditions.

Thus, this study aims to identify and analyze the different socioeconomic and environmental conditions of rural

households in the state of Acre, in the period 1996/1997 to 2006/2007, given the kinds of access to land and types of

governance resources (land / environment)

2. DEVELOPMENT AND RURAL POVERTY

Until the early '60s, there was no need to distinguish development of economic growth, since until then the

developed nations were the same that had become rich through industrialization. The other countries were poor and

underdeveloped, and in some of them industrialization was still nascent. However, the perception that the intense

economic growth occurred during the 50s in many semi-industrialized countries (including Brazil), did not necessarily

translate into increased access of the poor to material goods, but also in improving the levels of education and health, as

occurred in developed countries entitled (Veiga, 2008). Allied to this, the oil crisis in the late 60's signaled the need to

think about the limits and consequences of economic growth on the environment and quality of life (SOUZA, 2008).

Over time, the conceptions of development have acquired various meanings. In the economic literature, it is clear

that there are three basic concepts of what is developing. The first stream supports the idea that development is

synonymous to economic growth, measured by traditional indicators such as Gross Domestic Product (GDP) per capita.

The second thought is that the development is merely an illusion, a sort of myth or ideological manipulation. Finally, a

third view asserts that economic growth is essential but not sufficient, since the development should be based on the

qualitative aspect of the social point of view, without requiring exhausting performance, poor remuneration and

performance of consumption patterns irresponsible (Furtado, 2000; SOUZA, 2008; VEIGA, 2008).

However, it was with the publication of the Brundtland Report in 1987, which was made public the best known

concept of sustainable development, which would soon become a reference worldwide (CAVALCANTE, 1993). In this,

we define sustainable development as "that meets the needs of the present without compromising the ability of future

generations to meet their own needs." (WCED, 1987 apud BUARQUE, 2002, p.59).

We must point out the difficulty of interpreting the term sustainable development, which is a widely accepted term,

but has not been exactly a unique significance as to direct the actions of change. As a normative concept, he came up with

the name eco-development indicating a development that takes into account economic efficiency, ecological prudence and

social justice (Daly, 1996; PALMER, 2001).

However, a broader view and critique of the development was launched in 2000 by the Indian economist, Amartya

Sen, in the work entitled "Development as Freedom", which sets the development "as a process of expanding the real

freedoms that people enjoy "(Sen, 2000, p.17).

This focus on human freedoms contrasts with the traditional view of development as a result of growth of Gross

National Product (GNP), income growth, industrialization, technological advancement and modernization of a country,

region or locality. Anyway, freedom depends on other determinants, such as social and economic arrangements (health,

education) and civil rights (political participation, public inquiries) (Sen, 2000).

For SEN (2000), the achievement of freedom requires that development removes major sources of un-freedom,

such as: poverty, lack of political freedom, deprivation of basic civil rights, lack of economic opportunities, neglect of

public services (education, health, sanitation, clean water, etc.)., hunger, malnutrition, unemployment, gender inequality,

among other.

In addition to these hardships, we can also mention the situation of landless individuals and may result in the loss

of productive opportunities, economic, investment, access to credit, among others, and compromise the expansion of

individual liberties (Deininger, 2003).

In his work, Sen (2000, p.109), focuses especially on poverty, defined by him "as a deprivation of basic capabilities

rather than merely as low income," since they may be influenced by other variables such as age, disability or illness which

may reduce the individual's potential to earn income. According to the author, income is important in the sense that it

extends the individual capabilities, just as better education and health services can directly elevate the quality of life and

increase the potential for a person earning income and thus get rid of poverty measured by income. In other words,

poverty is a multidimensional phenomenon that goes far beyond a specific deficiency. (Buainain et al. 2010)

Depending on the conceptualization of poverty, different methods for its measurement and analysis can be used. In

the case of poverty related to income the next methods can be highlighted: as insufficient income, poverty and extreme

poverty line, poverty defined by public policy, the minimum wage as a criterion, insufficient income and access to basic

conditions life, regionalized consumption baskets, stated income and poverty. For the multidimensional approach, there

are two main indexes: the Human Development Index (IDH) and the Human Poverty Index, both developed by the United

Nations Program for Development (UNDP), incorporating the vision of basic capabilities, proposed by Amartya Sen

(Buainain, 2010; Veiga, 2005). Even within the multidimensional approach, there is the Rural Family Development Index

(IDF-R), developed by IPEA, from the Human Development Index (HDI) (Barros et al., 2006). Poverty and inequality in

Brazil decreased considerably in recent years, especially since the 2000s, but even so, "Brazil still has established itself as

one of the most unequal nations, with the largest number of the world's poor." (MAIA & Buainain, 2012).

For Maia & Buainain (2012, p. 4), the main determinants of these changes include: "The expansion of the rural

pension system from the '90s, which helped to eliminate many families out of poverty and to reduce the gap between the

richest and poorest of Brazil (MAIA, 2010), the intensification of political public direct income transfer, which helped to

ease the situation of vulnerability of poor households (Medeiros et al., 2007); important changes in structure and

remuneration of labor market agricultural and non-agricultural (Gasques et al., 2010), besides the almost continuous

appreciation of the minimum wage since 1994, the basis for payment of social security benefits and income of the poorest

in the labor market.".

According to the report published by the Economic Commission for Latin America and the Caribbean (ECLAC,

2010), in Brazil, in 2009, "25% of the population were in poverty and 7%, on condition of indigence," representing in

absolute numbers, approximately 47.5 million and 13.3 million, respectively, in poverty and indigence. With respect to

income concentration, the Human Development Report of the United Nations (UNDP, 2010) indicated that the Gini

coefficient for income inequality in the country (0.55) "was less than the few countries in the world, all with low

standards of human development, such as Bolivia, Botswana and Namibia." (MAIA & Buainain, 2012, p. 3). According

to the analysis from the Institute of Applied Economic Research (IPEA), using micro data from PNAD/IBGE, in 2009,

the Northern Region was the second poorest in the country, behind only to the Northeast, and the State of Acre ranked in

12th position in the national ranking and 3rd in the ranking of the North, ie 32.39% of the population is considered poor.

Furthermore, 12.43% of Acre lived in extreme poverty.

Among the main factors explaining poverty in Brazil are historical inequality in the distribution of income and

wealth in the country and the lack of a comprehensive plan for land administration, which worsens increasingly the

serious conflicts over land (MARTINS , 2002 and REYDON, 2011 ).

For Kageyama and Hoffmann (2006), Brazilian poverty has a dual nature, ie, on one hand, is the result of

underdevelopment and regional location, which imposes deprivations on the basic conditions of existence (electricity,

piped water, health, education, etc.) depending on public and private investments to overcome them, on the other hand,

poverty has roots in demographic characteristics and the limitations of human and financial capital of households that

impair the ability to raise the family income, and they may be supplanted with improvements in primary education, access

to the labor market or the social security programs.

In the case of the Amazon region, in particular, the key poverty determinants are the lack of available resources,

mainly land and labor relations, with even the remaining of slave labor (MATTEI, 2012).

Regarding the importance of land tenure Deininger (2003, p.17) made the following statement: "The land is a key

asset for the rural and urban population. It provides a basis for economic activity and functioning of the market (eg, loans)

and non-market institutions (eg, local governments and social networks) in many developing countries."

Observing the Brazilian land issue, Reydon (2011) considers the high concentration of land ownership as the main

reason of the great social and economic inequality in the country and a significant portion of its rural poverty, especially

through social exclusion, given that the poorer individuals have no access to land. This high degree of concentration is

expressed in indicators such as the Gini index of property, which in 2006 remained at a high level of 0.85.

However, for Reydon (2011), the country's main Brazilian problem is the lack of concrete mechanisms regulating

the ownership; use and occupation of rural and urban land. And this lack of regulation, effective and not rules, and stems

is determined by the possibilities of speculating on land - ie, make money on the purchase, maintenance, conversion and

subsequent resale of land in any of its forms.

In the Amazon, the absence of regulation translates into problems take possession of lands, land speculation, high

rates of deforestation, which value the property in the land market. Thus, the regulation that would be ideal in which

society and governance have passed could define proper use of soil, either from the standpoint of production, whether for

housing, while preserving the environment (Reydon, 2011)

3. MATERIAL AND MEHODS

3.1. AIM

The aim of this study is to analyze: four Oriented Settlement Projects (Projetos de Assentamento Dirigidos,

PAD’s), from a total of 5 PAD’s existing in Acre; four Settlement Projects (PA), from a total of 71; 1 Agroextractive

Settlement Project (ASP), from a total of 11; 3 Extractive Reserves (RESEX), from a total of 5; and 2 areas of private

ownership and of the RECA Project5, distributed between the regions of the Acre Valley (Vale do Acre) and Juruá Valley

(Vale do Juruá) , in the State of Acre – Brazil. In order to simplify analysis, we are working with these two old regional

division in Acre. Presently, Acre is divided in 5 areas of development: High Acre, Down Acre, Purus, Tarauacá / Envira

and Juruá.

Source: ACRE, 2011.

Figure 1 – Regions of Development, State of Acre

The survey was initially performed in the systems of agriculture, extraction and agroforestry in the period

1996/1997. Due to the success of the study in determining local public policies, such as the State Law Chico Mendes and

the establishment of Agroforestry Poles in Acre, the survey was expanded to the Juruá Valley, being applied in its

agricultural production systems in1999/2000 and in its extractive production system in 2000/2001. The research was

reapplied in the respective regions of the Acre Valley in 2005/2006 and of the Juruá Valley in 2006/2007, in the same

areas surveyed in the first phase (Table 1).

.

5 RECA project is the common name attributed to the Association of Small Farmers and Forestry Workers of the Project of Economic

Reforestation Project Joint Ventured and Compacted (RECA), located in the District of Nova Califórnia, 360 km from the city of

Porto Velho - RO and 150 km from Rio Branco - AC. The Project was created in 1989 and consists of groups of farmers from

southern Brazil, which by exchanging experiences with Amazonian rubber tappers established a new mode of production, an

association of the use of forest and fruit species in the same space today widely known as agroforestry or SAF's. The central feature

of this project is a strong social organization that allows producers' participation in decisions relating to all stages of the process of

production, as well as in the destination of the processed products (palm, cupuaçu, among others). So far there is no regularization

or titling of land in the RECA Projetct. (PROJETO QUEM FEZ BEM, S/D).

Table 1 – Areas of study and period of analysis

Region

Year

Phase I Phase II

Acre Valley 1996/1997 2005/2006

Juruá Valley 1999/2001* 2006/2007

* In 1999/2000 the research was applied in the

agricultural system and in 2000/2001 in the extractive

system.

3.2. Survey design

The sample of Family Farms Units (UPF `s) surveyed in the state of Acre was defined in three stages:

Stratification of the areas of each production system (extractive, agricultural and agroforestry) according to their

levels of development (high, medium and low). The criteria to define the level of development was related to

the volume of production, quality and ease of access, availability of infrastructure and technical assistance, and

the degree of community organization;

Random selection of half of the stratum in the area of study based on the representativeness of each stratum;

Random selection of 10% of the production units within each stratum selected in the previous stage.

Tables 2 and 3 describe the sample design in the regions Acre and Juruá Valleys.

Table 2 – Sample Design in the Acre Valley– Acre – Brazil

System of

Production Local Municipality

Sample

Size Families

Settled Area (ha)

Date of

Creation

Agriculture

PAD Peixoto

Plácido de Castro 46

4,671 296,243.87 31/10/1977

Senador Guiomard 45

Rio Branco 1

Acrelândia 13

Total 105

PAD Humaitá Porto Acre 37 951 61,179.00 22/09/1980

PAD Boa Esperança Sena Madureira 37 983 275,646.00 27/12/1976

Total PAD's 179 6,605

Extractive

PAE Porto Dias Acrelândia 10 96 24,348.93 23/12/1987

Total PAE's 10 96

RESEX Chico Mendes

Xapuri 46

1,495 970,570.00 12/03/1990

Assis Brasil 10

Brasiléia 7

Capixaba 5

Total RESEX 68

Agroforestry RECA Project Porto Velho - RO* 30 300 21,414.00

ACRE VALLEY 287 8,496 1,649,401.80

Fonte: MDA/INCRA (2007). ZEE/AC (2006),

* In the first period, region where the RECA project is located belonged to the State of Acre. Presently, it is within the

geographical boundaries of the State of Rondônia. after decision of a litigation process.

Table 3 - Sample Design in the Juruá Valley – Acre – Brazil

System of

Production Local Municipality

Sample

Size Families

Settled Area (ha)

Date of

Creation

Agriculture

PAD Santa Luiza Cruzeiro do Sul 41 821 57,219.67 11/07/1980

Total PAD's 41

PA São Pedro Rodrigues Alves 23 330 25,151.28 10/07/1980

PA Amônia Marechal Thaumaturgo 12 213 26,000.00 19/04/1995

PA Envira Feijó 11 235 5,762.29 04/09/1995

PA Novo Destino Tarauacá 11 310 27,749.47 20/07/1988

Total PA's 57 1,909

Pentecostes Community

Cruzeiro do Sul 12

150 5,946.00 Mâncio Lima 3

Total POSSE 15 150

Extractive

RESEX Alto Juruá Marechal Thaumaturgo 23 850 538,492.00 23/01/1990

RESEX Rio Liberdade Cruzeiro do Sul 9 177 325,602.00 17/02/2005

Total RESEX 32 1,027

BR 364 Community Feijó 7 70 23,030.00

Total POSSE 7 70

JURUÁ VALLEY 152 3,156

Fonte: MDA/INCRA (2007); ZEE/AC (2006).

3.3. Methodology

This study evaluates the economic conditions of the rural families in Acre based on the indicators developed by the

Project of Economic Analysis of Systems of Basic Production of Rural Family in Acre (ASPF), sponsored by the

Department of Economics at Federal University of Acre (MACIEL, 2011).

Analyses evaluate of the inputs (costs) and outputs (economic outcomes) of Farms Family (FSU's), located in the

the PAD's, EAP's, RESEX, Project RECA and areas of private ownership, considering a period of 12 months, this means,

the agricultural year in the region. Overall, four periods were used for socio-economic analysis: two periods in Acre

Valley (1996/1997 and 2005/2006) and two in the Juruá Valley (1999/2001 and 2006 / 2007). All monetary values were

deflated to February 2013 based on the National Consumer Price Index (INPC).

Three main groups of indicators were considered (ASPF, 2008; MACIEL, 2011): total production costs; outcome

measures; and measures of economic efficiency.

Total Production Costs

Total Costs (CT): CVCFCT

CFcCFe

Thus, CT can also be represented by:

CVCFcCFeCT (a.1)

Considering tha Ce CV CFe (a.1.1)

We have:

CFc Ce CT (a.1.2)

Where CV = variable costs ; CFe = Specific Fixed Costes; CFc= Common Fixed Costs; Ce = Specific Costs.

Gross Results

Gross Income (RB): RB = Qv.pp

Where : Qv = units sold; pp = unit price.

Total Gross Income (RBT): RBT = RB + RT + RA

Where: RT = income from cash transfers; RA = wage outside the UPF.

Line of Dependence of the Market (LDM): LDM = Vbcc + CF

Where: Vbcc = value of goods purchased in the market to maintain the family; CF = value spent on replacement

of fixed capital (machines, equipment, tools, improvements, among others). Thus, LDM is the amount spent by

the family to maintain the existing means of production.

Net Results

Net Income (RL): RL = RB – DE

Where: DE = actual expenses.

Gross Family Income (MBF): MBF = RB – (CV – Cftf)

Where: RB = gross income; Cftf = actual cost fo the family labor.

Level of Life (NV): NV = (MBF + AC + Cjicc) – AA

Where: Cjicc = interest rate; AC = Self-Consumption; AA= Annual Amortization.

Measures of Efficienty

IEE = RB/CT

When IEE > 1, there is profit; when IEE < 1, there is lost; when IEE = 1, there is equilibrium between income

and expenditures.

MBF/RB – Percentage of the gross income that the production unit is able to convert in gross family income. A

ratio exceeding 50% is considered favorable.

MBF/Q/h/d – index of remuneration for the family labor.

Interchange term (TI): TI = Vbcc/RB - index of the RB appropriated by the market.

In order to analyze poverty, this study defined groups of income based on the Brazilian minimum wage, presently

at R $ 678.00 / month. UPF’s were classified in six groups: A) NV greater than 4 minimum wages; B) NV between 2 and

4 minimum wages; Ca) NV between 1 to 2 minimum wages; Cb) NV between ½ and 1 minimum wage; D) NV between

½ and ¼ minimum wages; E) NV lower than ¼ minimum wages.

4. RESULTS

According to indicators presented in Table 4, UPF’s from the PAD’s and RECA Projects had the best economic

results in the Acre Valley in the first period of analysis. In relation to the efficiency rate (IEE), the PAD’s had an index of

1.87 in the agricultural year 96/97, followed by RECA Project, with 1.85. In other words, these UPF’s presented average

economics outcomes higher than their costs. However, results reveal that these projects had negative growth for the IEE

(61.9% for PAD’s and 35.59% for RECA). This reduction in the production efficiency is related to the production costs,

especially fixed costs. In the Project PAD's, fixed costs more than doubled and in the Project RECA it grew almost seven

times more than the fixed costs, possibly due to high investment in machinery, equipment, work tools and building

improvements. Due to these higher fixed costs, the families’ gross income in the PAD's reduced 32.59%. Moreover,

despite increasing fixed costs, average gross income in the RECA Project increased by 181.69%, specially due to

productivity gains in the production of palm (pupunha) and seeds of palm, as well also to the growing demand for

processed palm by the Association of Producers of the Project.

These analyses are reinforced by the dynamics of the Gross Family Income (MBF), which measures the income

available to purchase goods and services in the market (market expenditures) and for replacement of fixed capital. The

MBF in the PAD’s reduced 33.34%, suggesting that the production gains (R$ 578.78 / month) became insufficient to

cover the market expenditures (R$ 1,497.45 / month). As a result, the LDM increased by 123.97%. These results suggest

that families with need to purchase personal goods, such as food and clothing, as well as production goods, such as

machinery, equipment, tools and building improvements, probably lost heritage in the period. Moreover, the value of the

MBF in the RECA Project increased 169.8%: from R$ 386.96 / month yo R$ 1,043.84 / month. This value is now very

close to the needs for market consumption, which rose from R $ 526.84 / month in 96/97 to R $ 1,251.04 / month in

05/06.

On the other hand, UPFs in the PAE and RESEX projects presented economic results lower than those of the

PAD’s and RECA Projects, as a result of long distance from the market, isolation, low technological level, difficulties in

the trade, among others. In the first period of analysis, UPFs in these extractive projects presented index of economic

efficiency higher than 1 and, in the case of the RESEX project, a MBF high enough to maintain the preexistent production

factors. However, the dynamics of these indicators highlight the economic efficiency reduced in both areas, as a result of

increasing fixed costs.

Besides income from production, income from pension and cash transfers programs played also an import role in

the economic dynamics of these UPFs, increasing family income and allowing higher market expenditures. These sources

of income increased substantially in the PAD’s and PAE projects, whereas income from wages reduced. Opposite trend

were witnessed in the RESEX area, where income from pensions and cash transfers reduced and wages increased. Since

cash transfers are conditional to the involvement of children in schools, this reduction can be due to difficulties witnessed

in the operation of the schools in these areas, as well as school dropouts. In the RECA project both the income from labor

and from social transfers decreased and the self-production became the main source of income.

Results also highlight that the Level of Life (NV) reduced in the PAD’s, PAE and RESEX, whereas it increased in

the RECA Project. In the former projects, the MBF increased tenuously, whereas self-consumption reduced substantially.

Moreover, the dependence of cash transfers increased in the agriculture and agro-extractive settlements, as well as the

dependence of external wages increased in the extractive areas. In the RECA Project, both MBF and self-consumption

production increased expressively. Moreover, market expenditures increased slightly, supported by the self-production

income, since income from social transfers reduced substantially in this area. Overall, it can be highlighted that both

production and self-consumption contributed to increase the level of life for these agroforestry farmers. Besides the fact

that families living in the PAE’s, RESEX and PAD’s experienced hard economic conditions in the period, their

production is it economically viable, since the level of life attained in all these types of settlements outpaced the value of

the minimum wage in Brazil.

Results in Table 5 highlight that the UPFs in the PADs and the PAs Projects had the best economic performance in

the period of 99/01, especially due to the results for the economic efficiency index and MBF. However, in 06/07 both

settlements had negative results for economic efficiency, specially the UPFs at the PAD’s Project. The UPFs at the

Extractive Reserves improved the economic efficiency, due to reduction in the fixed and variable costs. Now they present

the second best economic performance, just surpassed by the PA’s Project.

It must also be highlighted that in 99/01 the amount of income from social programs in the PAD’s Project was

substantial, almost in the same amount of the income from production. On the other hand, the income from production in

the PA’s was fundamental in 99/01, due to the low level of wages and the absence of income from social programs in

these areas. But the growth of income from social programs was substantially in the next period in both projects, although

not enough to sustain the market expenses (see line of dependence of the market).

Private ownerships had better economic results than RESEX in 99/01, especially due to external wages. But in the

next period the economic performance of the UPFs at the RESEX improved substantially and that of the private

ownerships became the worst among all the projects. This dynamics stresses the difficulties witnessed for those families

with no property rights over their land, which have no resource to invest in their property and are not allowed to access

diverse types of funding sources for small family farms in Brazil. Families ate the RESEX project have both property

rights over their land and access to special programs oriented for small agriculture production, such as those oriented form

manioc flour production, the main component of the income among the farmers at the Juruá Valley.

The Level of Life also reduced for all types of settlements in the Juruá Valley. However, those families in the

RESEX project had the best performance, especially due to the high contribution of self-consumption income, which

represented 80% of the minimum wage value in Brazil. On the other hand, families in private ownerships had the worst

performance, especially due to the huge reduction in the production for self-consumption.

Table 6 presents a stratification of the families in the Acre Valley according to Levels of Life (NV). Six classes

were defined based on proportions of the minimum wage in Brazil (R$ 678,00/month). Poor were considered those

families with per capita income lower than ½ minimum wage (class D) and extreme poor those families with per capita

income lower ¼ minimum wage (class E).

First, results highlight an expressive increase in the number of poor (D) and extreme poor (E) in the Acre Valley.

The poor are accumulated in higher share in the PAE’s project and the extreme poor in the PAD’s project. Those families

in the class C are especially distributed among projects PAE’s and RESEX. Those families with per capita income higher

than 4 minimum wages (A) or between 4 and 2 minimum wages (B) prevail in the RECA Project.

The number of poor and extreme poor grew even hardly in the Juruá Valley. They are especially accumulated in the

RESEX project and in Indian communities in private ownership. Families in the class D prevail in all types of settlements.

There are few families in class A, in the PA’s and PAD’s project and families, families in class B are accumulated in the

RESEX area.

Table 4 – Median Economic Performance according to type of settlement, Acre Valley, Acre – Brazil. (I summarize)

Indicator Unit 96/97 05/06 ΔY/Y(%)*

PAD's PAE RESEX RECA PAD's PAE RESEX RECA PAD's PAE RESEX RECA

RB R$/month 1,155.22 318.68 354.97 414.43 778.71 408.73 460.67 1,167.42 -32.59 28.26 29.78 181.69

MBF R$/month 868.30 221.11 320.30 386.96 578.78 332.06 394.80 1,043.84 -33.34 50.18 23.26 169.75

AC R$/month 806.13 754.33 1,080.56 311.81 200.75 299.97 363.60 394.05 -75.10 -60.23 -66.35 26.37

NV R$/month 1,768.00 935.53 1,414.36 649.39 827.91 733.06 790.67 1,516.90 -53.17 -21.64 -44.10 133.59

LDM R$/month 668.59 334.47 308.94 526.84 1,497.45 816.66 1,058.64 1,251.04 123.97 144.16 242.67 137.46

IEE und, 1.87 1.25 1.35 1.85 0.73 0.85 0.58 1.12 -61.09 -31.69 -56.85 -39.59

Observation: *In relation to the agricultural year 1996/1997. RB - Gross Income; MBF - Gross Family Income; AC - Self-Consumption; NV - Level of Life; LDM - Line

of Dependence of the Market; IEE - Index of Economical Efficiency.

Table 5 - Median Economic Performance according to type of settlement, Juruá Valley, Acre – Brazil. (I summarize)

Indicator Unit 99/01 06/07 ΔY/Y(%)*

POSSE PAD PA RESEX POSSE PAD PA RESEX POSSE PAD PA RESEX

RB R$/month 469.86 530.45 551.17 319.89 225.82 354.40 406.47 285.21 -51.94 -33.19 -26.25 -10.84

MBF R$/month 296.45 386.64 328.76 220.94 186.51 244.45 304.99 254.53 -37.09 -36.78 -7.23 15.20

AC R$/month 567.31 553.93 531.05 549.72 200.03 155.08 155.96 226.02 -64.74 -72.00 -70.63 -58.88

NV R$/month 1,118.25 1,197.03 835.41 848.73 385.48 532.24 479.04 552.37 -65.53 -55.54 -42.66 -34.92

LDM R$/month 594.10 692.66 528.03 533.64 614.97 1,268.38 941.03 742.08 3.51 83.12 78.22 39.06

IEE und, 0.83 1.15 1.05 0.53 0.61 0.51 0.63 0.79 -26.40 -55.23 -39.58 47.04

Table 6 – Percentage of Families according to Level of Life (NV), Acre and Juruá Valleys (%).

Class % at Acre Valley % at Juruá Valley

1996/1997 2005/2006 Y/Y 1999/2001 2006/2007 Y/Y

A 25,00 9,41 -60,87 5,71 1,32 -3,71

B 26,81 17,77 -31,08 25,71 9,87 -15,85

C (a - high) 29,71 35,19 23,17 38,29 26,32 -11,97

C (b - low) 13,77 21,95 65,79 20,00 26,32 6,32

D 3,62 9,76 180,00 8,00 21,71 13,71

E 1,09 5,92 466,67 2,29 14,47 12,19 A – NV > 4 Minimum Wages (MW)

B - 2 MW/month < NV < 4 MW/month;

C (a – high ) - 1 MW/month < NV < 2 MW/month;

C (b - baixo) - 1/2 MW/month < NV < 1 MW/month;

D - 1/2 MW/month > NV > 1/4 MW/month;

E - NV < 1/4 MW/month.

Table 7 – Percentage of families according to type of settlement and Level of Life (NV), Acre and Juruá Valleys (%).

% at Acre Valley % at Juruá Valley Difference

Class 1996/1997 2005/2006 1999/2001 2006/2007 Acre Valley Juruá Valley

PAD PAE Reca RESEX PAD PAE Reca RESEX PA PAD POSSE RESEX PA PAD POSSE RESEX PAD PAE Reca RESEX PA PAD POSSE RESEX

A 35 0 3 15 11 10 20 1 2 7 13 3 2 2 0 0 -24 10 17 -13 0 -5 -13 -3

B 27 9 10 37 13 10 40 21 23 36 31 13 9 12 5 13 -13 1 30 -16 -14 -24 -26 0

C (a) 26 73 31 31 38 40 20 34 45 33 26 47 30 17 27 31 12 -33 -11 3 -15 -16 2 -16

C (b) 8 9 41 16 21 20 10 31 24 14 13 28 23 32 27 25 12 11 -31 15 -1 17 14 -3

D 2 9 14 1 11 20 7 7 6 7 10 9 18 27 18 25 8 11 -7 6 11 20 8 16

E 2 0 0 0 7 0 3 6 0 2 8 0 19 10 23 6 5 0 3 6 19 7 15 6 A – NV > 4 Minimum Wages (MW)

B - 2 MW/month < NV < 4 MW/month;

C (a – high ) - 1 MW/month < NV < 2 MW/month;

C (b - baixo) - 1/2 MW/month < NV < 1 MW/month;

D - 1/2 MW/month > NV > 1/4 MW/month;

E - NV < 1/4 MW/month.

5. FINAL CONSIDERATIONS

The economic analysis of the results obtained in terms of access to land surveyed in the Vale do Acre and Juruá

Valley demonstrated how living conditions have changed in these regions, in a relatively short space of time. In general, it

was found that the rents are low in both regions, as well as a significant worsening in the economic situation of families of

farmers and / or extractive residents in these localities, clearly visible in the analysis of the evolution of the Index of

Economic Efficiency and above , the monetary value of the standard of living. However, a more accurate indicator of the

latter reveals that the deterioration of the living conditions of the families was more severe in Juruá.

The decline in the standard of living of rural families of Acre, is explained on the one hand, the fall in rubber prices

and other extractive products, except the Brazil nut and agricultural products, as a result of market disruption. On the

other hand, justified by the absence of technical progress, resulting in high production costs. It is noteworthy that in the

Valley of Acre economic performance was worse not only because the valuation of the Brazil nut, made possible by

strengthening the institutional arrangements surrounding this chain.

The economic disadvantage of Juruá Valley over the Valley of Acre is delineated a priori by distance and isolation

from the city of Cruzeiro do Sul - the main commercial center of Juruá - for capital Rio Branco, constituting a major

obstacle to commercialization . Furthermore, although the last ten years the region has received greater incentives Juruá

Public Policy, compared to previous periods, yet they still are to a lesser extent than those for the Valley of Acre.

Moreover, such initiatives have not yet been converted into concrete results to improve life for people in traditional Juruá.

In the productive aspect, that region has long been the most responsible for the production of rubber in the state of

Acre, however, with falling prices and lack of demand, tappers Juruá practically gave up the marketing of the product.

Alternatively, families were focused on the production of cassava flour, becoming therefore the main economic activity of

the region. However, with time the product began to face problems of decreased productivity due to depletion of soil and

therefore problems increase production costs, which could not be compensated for even with an increase in product price.

In fact, at the end of the production process, the family farmer has little if appropriate profit margins, since they, for the

most part are channeled to the middlemen, thus indicating a serious problem in forming the final price of flour.

Finally, it is essential to highlight the most important aspects of the evolution of the economic performance of the

families in accordance with the terms of access to land, searches for the Vale do Acre and Juruá Valley.

Observing the standard of living indicator, which reflects the total amount appropriated by the farmer and / or

extraction, it was found in the Valley of Acre that the Project was the only RECA where families have achieved an

increase in their standard of living, having income from production and consumption as determinants of this central result.

Conversely, respectively in the PAD's, RESEX and PAE was a drastic reduction in the standard of living of families, led

by a sharp reduction in consumption, revealing a greater dependence on the market for the purchase of consumer goods

and therefore indicating the greatest indebtedness of these families, since income growth of production proved

disproportionate to rising production costs, especially in RESEX and PAE.

However, Juruá Valley was reduced even more drastically in the standard of living of families of all types of access

to land, both by the large reduction in consumption as the reduction in income from production. Families identified with

better off were those located in Extractive Reserves, with the smallest reduction in standard of living, then to the PAD's,

PA's and, finally, those living in areas of ownership, which were reduced over 50 % in income from production,

consumption and therefore the standard of living, revealing the difficulties of local ownership without defined to provide

adequate levels of income and even food security for households installed there.

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APÊNDICE

I – Median Economic Performance according to type of settlement, Acre Valley, Acre – Brazil. (Table completes)

Indicator Unit 96/97 05/06 Y/Y(%)*

PAD's PAE RESEX RECA PAD's PAE RESEX RECA PAD's PAE RESEX RECA

RB R$/month 1,155.22 318.68 354.97 414.43 778.71 408.73 460.67 1,167.42 -32.59 28.26 29.78 181.69

RA R$/month 92.14 43.59 33.68 285.32 56.23 0.00 56.45 27.10 -38.97 -100.00 67.60 -90.50

RT R$/month 285.32 0.00 545.28 557.96 474.22 128.72 128.72 97.78 66.20 -76.39 -82.48

RBT R$/month 1,272.68 318.68 364.02 506.25 1,074.89 408.73 595.03 1,202.08 -15.54 28.26 63.46 137.45

RL R$/month 821.11 167.33 249.58 323.33 342.94 173.06 205.25 887.48 -58.23 3.42 -17.76 174.49

MBF R$/month 868.30 221.11 320.30 386.96 578.78 332.06 394.80 1,043.84 -33.34 50.18 23.26 169.75

CF R$/month 256.96 83.59 123.62 90.21 645.70 262.82 417.36 632.00 151.28 214.42 237.61 600.56

CV R$/month 225.81 118.61 101.05 111.77 257.91 202.40 130.23 294.59 14.22 70.64 28.88 163.57

VBCC R$/month 369.64 231.58 147.70 373.66 809.94 518.78 549.69 690.31 119.12 124.02 272.17 84.74

LDM R$/month 668.59 334.47 308.94 526.84 1,497.45 816.66 1,058.64 1,251.04 123.97 144.16 242.67 137.46

AC R$/month 806.13 754.33 1,080.56 311.81 200.75 299.97 363.60 394.05 -75.10 -60.23 -66.35 26.37

NV R$/month 1,768.00 935.53 1,414.36 649.39 827.91 733.06 790.67 1,516.90 -53.17 -21.64 -44.10 133.59

IEE und, 1.87 1.25 1.35 1.85 0.73 0.85 0.58 1.12 -61.09 -31.69 -56.85 -39.59

MBF/RB und, 0.89 0.83 0.92 0.93 0.85 0.87 0.93 0.90 -3.71 4.95 1.49 -3.21

MBF/Qh/d R$/day 83.72 8.93 15.99 44.11 66.41 23.23 42.70 74.06 -20.68 160.12 167.06 67.91

TI und, 0.34 1.01 0.47 0.72 1.02 1.55 1.42 0.50 203.56 54.07 198.80 -30.55 Observation: In relation to the agricultural year 1996/1997. RB - Gross Income; RA - wage outside the UPF; RT - income from cash transfers; RBT - Total Gross

Income; RL - Net Income; MBF - Gross Family Income; CF - Fixed Costs; CV - variable costs; Vbcc - value of goods purchased in the market to maintain the

family; LDM - Line of Dependence of the Market; AC - Self-Consumption; NV - Level of Life; IEE - Index of Economical Efficiency; MBF/Q/h/d – index of

remuneration for the family labor; TI - Interchange term.

II - Median Economic Performance according to type of settlement, Juruá Valley, Acre – Brazil. (Table completes)

Indicator Unit

99/01 06/07 Y/Y (%)

POSSE PAD PA RESEX POSSE PAD PA RESEX POSSE PAD PA RESEX

RB R$/month 469.86 530.45 551.17 319.89 225.82 354.40 406.47 285.21 -51.94 -33.19 -26.25 -10.84

RA R$/month 214.25 61.75 55.79 72.90 54.20 56.45 36.70 62.10 -74.70 -8.57 -34.23 -14.82

RT R$/month 306.20 526.10 0.00 482.06 365.82 519.94 250.66 128.72 19.47 -1.17 100.00 -73.30

RBT R$/month 574.93 696.37 574.41 415.71 410.99 740.68 670.68 748.58 -28.52 6.36 16.76 80.07

RL R$/month 220.17 300.83 269.75 172.56 70.95 147.34 180.06 124.28 -67.77 -51.02 -33.25 -27.98

MBF R$/month 296.45 386.64 328.76 220.94 186.51 244.45 304.99 254.53 -37.09 -36.78 -7.23 15.20

CF R$/month 284.97 307.35 254.00 340.19 231.46 592.67 456.23 229.22 -18.78 92.83 79.62 -32.62

CV R$/month 200.41 191.64 162.73 132.73 133.31 187.29 142.96 107.13 -33.48 -2.27 -12.15 -19.29

VBCC R$/month 292.21 286.10 249.80 169.50 614.97 705.36 506.67 426.22 110.46 146.55 102.83 151.47

LDM R$/month 594.10 692.66 528.03 533.64 614.97 1,268.38 941.03 742.08 3.51 83.12 78.22 39.06

AC R$/month 567.31 553.93 531.05 549.72 200.03 155.08 155.96 226.02 -64.74 -72.00 -70.63 -58.88

NV R$/month 1,118.25 1,197.03 835.41 848.73 385.48 532.24 479.04 552.37 -65.53 -55.54 -42.66 -34.92

IEE und, 0.83 1.15 1.05 0.53 0.61 0.51 0.63 0.79 -26.40 -55.23 -39.58 47.04

MBF/RB und, 0.78 0.73 0.79 0.72 0.82 0.82 0.86 0.90 5.73 13.37 8.44 24.59

MBF/Qh/d R$/day 14.91 20.98 25.22 16.60 16.59 25.48 21.69 25.83 11.29 21.47 -14.00 55.61

TI und, 0,68 0,55 0,54 0,59 2,80 1,85 1,38 1,22 309,86 238,64 156,41 104,92

III – Evolution of costs and prices of the main products traded, the Acre Valley, 1996/1997 and 2005/2006, Acre - Brazil

Line Exploration Unit

Unit Cost Price (R$)

96/97 05/06 ΔY/Y(%)* 96/97 05/06 ΔY/Y(%)*

Pupunha Palmito Rod 0.80 0.46 -0.43 1.43 1.10 -23.03%

Coffee (C) Kg 0.80 0.35 -0.56 1.94 1.36 -29.67%

Banana Bunch 0.36 1.25 2.50 3.83 3.29 -14.02%

Seed Pupunha kg 3.99 4.26 0.07 18.33 14.27 -22.17%

Creating Bois un. 279.79 328.82 0.18 499.04 384.13 -23.03%

Cupuacu kg 0.21 0.64 2.10 1.81 0.44 -75.78%

Chestnut Tin (11 kg) 5.35 9.47 0.77 6.05 10.98 81.42%

Rubber Kg 2.79 2.80 0.00 1.18 2.30 95.09%

Bean Kg 1.67 2.54 0.52 1.36 1.32 -3.50%

Rice (C) Kg 1.88 1.29 -0.31 1.02 1.10 7.76%

Corn (C) Kg 0.35 0.60 0.70 0.35 0.44 26.78%

Manioc - manioc meal (S) Kg 2.24 2.24 0.00 1.08 0.88 -18.67%

Rice (S) Kg 1.35 1.36 0.01 1.02 1.10 7.76%

Corn (S) Kg 0.61 0.95 0.56 0.35 0.44 26.78% Note: * Relative to the period 1996/1997. C - consortium, S - single.

IV - Evolution of costs and prices of key marketed products, Juruá Valley, 1999/2001 and 2006/2007, Acre - Brazil

Line Exploration Unit

Unit Cost Price (R$)

99/01 06/07 ΔY/Y(%)* 99/01 06/07 ΔY/Y(%)*

Manioc - manioc meal (S) Kg 0.57 1.50 161.56% 0.63 0.97 53.99%

Rice (S) kg 2.36 0.73 -69.08% 2.58 0.48 -81.40%

Rice (C) kg 1.13 0.82 -27.11% 2.58 0.48 -81.40%

Creating Bois un. 729.69 545.12 -25.29% 527.00 424.35 -19.48%