This article extends recent insights from new institutional economics to explore the relevance of the concept of meso-institutions. It does so through the exploration of the case of the Brazilian Forest Code, pointing out how and why meso-institutions play a key role in making public policies effective. More specifically, our study shows how crucial is the complete fulfilling of the functions characterising meso-institutions – namely translation, monitoring, and enforcement, to implement regulations and determine their effectiveness. Lessons are drawn regarding the complexities inherent in the creation, implementation, and operationalisation of rules across a multilayered institutional environment.

Conflicts over resources with poorly defined property rights have fuelled both deforestation and violence in the Brazilian Amazon. However, what happens when the State enhances its ability to monitor and enforce existing environmental laws? We study the case of the list of Municípios Prioritários, a policy that allocates additional resources to verify compliance with environmental laws in municipalities with high deforestation rates. Employing a difference-in-differences approach, our findings suggest that an improvement in the ability of the State to monitor and enforce environmental laws can reduce conflicts over the appropriation of value from resources with poorly defined property rights. Consistent with existing studies, we also find that the policy led to a reduction in deforestation rates in the Brazilian Amazon. Finally, we discuss the limitations of the current approach to curb violence in a region where the activity of mafias has considerably grown since the turn of the twenty-first century.