Socio-Economic Consequences of Deforestation in Indonesia: A Systematic Review of Poverty, Livelihoods, Welfare, and Social Protection

Deforestation in Indonesia has occurred rapidly over the past three decades, yet its impacts on socio-economic outcomes remain debated. This systematic review aims to answer how deforestation relates to poverty, livelihoods, welfare, social policy, and social protection in Indonesia. Literature searches were conducted in Scopus, ScienceDirect, and Springer for English-language articles published between 2016 and 2026 with open access. Eligibility criteria followed the Population, Exposure, Outcome framework. Included studies were empirical research (qualitative, quantitative, or mixed methods) conducted in Indonesia with deforestation as the exposure and at least one socio-economic outcome. Two independent reviewers performed study selection, data extraction, and synthesis was conducted using thematic synthesis. Eighteen studies met the inclusion criteria. The relationship between deforestation and socio-economic outcomes is heterogeneous and context-dependent. Oil palm expansion and village fund allocation can reduce aggregate poverty at the district level; however, poor households, landless farmers, women, and indigenous communities experience increased food vulnerability, reduced nutritional diversity, and loss of access to forest resources. Traditional livelihoods are lost, but diversification through agroforestry and entrepreneurship shows adaptive potential dependent on social capital and technical assistance. Top-down policies such as food estate and Reducing Emissions from Deforestation and Forest Degradation (REDD+) consistently fail to protect vulnerable groups, disregard indigenous rights, and fail to implement Free Prior and Informed Consent. Conversely, locally-based approaches such as village funds and community-based forest management are more effective. Deforestation in Indonesia produces uneven aggregate economic gains at the expense of social justice and livelihood sustainability for the most vulnerable groups. Social policy and social protection need to be integrated with rights-based, gender-sensitive, and participatory approaches.