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Significance Tropical South America has forest resources of global significance but exhibits a relatively high rate of deforestation. As agricultural expansion remains the most important cause of forest loss and degradation there, it is important to understand its main drivers. In this paper we address two important questions: How do the quality of governance and agricultural intensification combine to impact the spatial expansion of agriculture? Which aspects of governance are more likely to ensure that agricultural intensification allows sparing land for nature? By distinguishing between conventional and environmental dimensions of governance (which includes also the establishment of protected areas), we investigate which of these two aspects, by interacting with the process of agricultural intensification, is likely to promote land sparing.

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