Deforestation and poverty are challenging problems in Ethiopia. The deforestation-poverty nexus is complicated by the institutional failures related to management of natural resources. This study was conducted to analyse the determinants of deforestation in Ethiopia, Western Oromia, the case of Komto Forest in East Wollega Zone, employing primary cross-sectional data on sampled households. Multistage sampling technique was used in selecting 150 household head respondents. Volume of woody biomass consumed and sold in cubic meter (M3) was used to measure deforestation. The Heckman maximum likelihood model estimates showed that large landholding size explain lower level of deforestation. It was also found that forest product sale, and corruption behaviour of households and staff of institution aggravates deforestation. Probability of forest product use is negatively related to kerosene use and positively to road access, purpose of use, and corruption perception. The study showed that poverty and institutional failure related to the forest management are key factors determining deforestation and forest degradation in the study area. Thus solving poverty and institutional failures would help solve deforestation problem of the study area.
Key words: Deforestation, poverty, institutional failure, Heckman selection model.