Short-run environmental effects of COVID-19: Evidence from forest fires.

The outbreak of the 2019 novel coronavirus disease (COVID-19) has raised questions about changes in economic production and subsequent effects on the environment. This article employs satellite data on real-time active fire locations in Nepal to evaluate the short-term environmental effects of COVID-19. Using plausibly exogenous variation in the number of reported COVID-19 cases across the country, this study finds that the incidence of COVID-19 led to a strong negative effect on the incidence of human-induced forest fires. Results indicate that an additional reported case of COVID-19 resulted in a 4.54% decrease in the number of forest fire incidents and a 11.36% reduction in fire radiative power associated with these events. Findings also show that districts with smaller areas of community-managed forests per capita experienced a 8.11% decrease in the number of forest fire incidents. Restrictions on movement of people across districts in response to the pandemic likely reduced the incidence of forest fire events in Nepal. These short-run estimates of environmental benefits, which do not account for negative consequences of the virus outbreak on health and labor market outcomes, partially offset the social cost of pandemics in the developing world.