Journal of Forest Economics最新文献

Reducing Emissions from Deforestation and Forest Degradation (REDD+) has been piloted in several developing countries. Limited funding available for REDD+ suggests that there is a need to adopt a targeted approach (i.e., targeting selected groups or regions) to make REDD+ projects more effective. However, there is no clear understanding of how targeting could be done based on households’ preferences for various design features of a REDD+ policy. Using choice experiment data obtained from two groups of households (project participants and outsiders) belonging to three types of forest management regimes (private, government and community) in Indonesia, this paper aims to identify classes of households that have similar preferences towards REDD+ design features. The scale adjusted latent class analysis indicates that there are four classes of households: (1) supporters emphasising household benefits, (2) supporters emphasising community projects, (3) indifferent but objecting restrictions, and (4) sceptics demanding monetary benefits. We also found that forest management regime is a key determinant of household classes. Our results suggest that REDD+ projects are likely to be more accepted by households in the community- and government-managed forest regimes. Such information will be useful to develop more targeted REDD+ projects.

In this paper, we explore the role of biofuel production on deforestation in low- and middle-income countries. Since the 2000s, biofuel production has been rapidly developing to address issues of economic development, energy poverty and reduction of greenhouse gas (GHG) emissions. However, the sustainability of biofuels is being challenged, particularly at the environmental level, due to their impact on deforestation and the GHG emissions they can generate as a result of land-use changes. In order to isolate the impact of bioethanol and biodiesel production among classic determinants of deforestation, we used a fixed effects panel model of 112 low- and middle-income countries between 2001 and 2012. Firstly, we found a positive relationship between bioethanol production and deforestation in these countries, among which we highlighted the specificity of Upper-Middle-Income Countries (UMICs). An acceleration of incentives for the production of biofuels from 2006 onwards enabled us to highlight higher marginal impacts for the production of bioethanol in the case of low- and middle-income countries and UMICs. Secondly, for low- and middle-income countries, these results are not significant before 2006. Thirdly, biodiesel production appears to have an impact on deforestation before 2006 on both subsamples. These last two results seem surprising and could be related to the role of biofuel production technologies and the crop yields used in their production.

This paper describes a method of estimating annual investment returns from forest growing businesses in New Zealand, using financial statement data. The method is also applied to survey data (derived from farm financial statements) published by New Zealand pastoral farming sector organisations. After data are adjusted for inflation, the total investment return is calculated as the sum of the cash return on assets, and the percentage change in asset value. The paper demonstrates that the total investment return calculated in this way is equivalent to the internal rate of return (IRR), for a single period of one year. The direct equivalence between this measure and the single-period IRR (calculated using discounted cash-flow analysis) is demonstrated algebraically and by example.

Calculated values for forestry show a wide range of investment returns for different businesses in any one year, although there has been a general trend for total returns to increase for forestry businesses since about 2008. Investment returns for dairy and sheep and beef generally follow similar trends, with dairy providing a higher return on average than sheep and beef over the period studied. The data for forestry and agriculture are not directly comparable, since the forestry data are extracted directly from the financial statements of individual businesses and the farming data are derived through a process of averaging financial returns from a large number of farms, with the objective of providing typical returns for benchmarking. The scale of the operations are also significantly different, with the benchmark dairy farm being 148 ha, the sheep farm 764 ha and the forest businesses ranging from 21,000 ha to 150,000 ha (most recent year in all cases).

The measure of total return used in this paper is attractive because it means the same measure can be used for evaluating existing businesses as would have been used to justify the initial set up of the business, or any projects that contributed to the business along the way. This provides a measure for ex post evaluation of existing investments that is consistent with one of the ex-ante decision criteria used at the time investment decisions are made. The method also provides separate estimates of the income or productive return, and the (usually) unrealised change in asset value. The paper demonstrates that the method can be applied to either individual company or industry average financial data equally easily. This method provides a viable alternative to using survey data to estimate annual investment returns.

The Emissions Trading Scheme (ETS) enacted in New Zealand in 2008 allows forest growers to claim units for carbon sequestered by new forests. As afforestation is an important contributor to New Zealand meeting net emission targets there is interest in forecasting the rate of afforestation, particularly how it will vary with the price of carbon in the ETS. Consequently a model is developed to estimate afforestation rate from the Land Expectation Value (LEV) of ‘traditional’ forestry (i.e., revenues only from log sales), the LEV from the carbon trading opportunity that the ETS creates, and land value.

Initially the relationship between afforestation rate and A grade log price during the period 1988 and 2008 is considered. Then the relationship between afforestation rate and LEV is evaluated. Initially the period up to 2008 is considered to evaluate the impact of ‘traditional’ forest profitability on the afforestation rate. Then the period from 2009 to 2015 is included and the impact of carbon is introduced. Finally the cost of land is introduced into the model.

The land affordability model developed allows the future afforestation rate to be forecast from carbon price, log price and land value.

The expansion of nature-based tourism on private land requires new mechanisms to coordinate tourism industry and commercial forestry interests. This attribute-based contingent valuation study elaborated the supply side of potential payments for ecosystem services (PES) mechanism named Landscape and Recreational Values Trading (LRVT), proposed to enhance the provision of amenity values in privately owned forests located in tourism and recreation areas. Using a mail survey data set, we analyzed forest owners’ willingness to participate in LRVT and the related compensation claims in the Ruka-Kuusamo area, Finland. We found that more restrictive rules regarding forest management practices decrease the probability of participating and increase forest owners’ compensation claims in LRVT. Furthermore, forest owners seem to claim more compensation if, instead of private negotiations, competitive tendering is used to make contracts. Moreover, besides the protection of landscape values, biodiversity protection may be a motive for participation. This indicates that, in addition to improved landscape quality, respondents gain personal benefits from enhanced biodiversity in their own forests. The results can help in designing and implementing a future payment mechanism for the provision of forest landscape and recreational values in terms of how to proceed and whom marketing and recruiting efforts should target.

Establishing conservation areas to protect biodiversity often results in economic trade-offs from reduced market opportunities for natural resource extraction. The purpose of this study was to quantify the economic impacts of two proposed conservation area scenarios in the Lower Peace Region of Alberta to determine the potential magnitude of the economic trade-offs. The first scenario, known as the Lower Athabasca Regional Plan (LARP), was proposed by the Government of Alberta under the Alberta Land-use Framework. The second scenario, referred to as the alternative scenario, was developed by the authors using a spatial land-use rationalization process. Economic impacts of each conservation area scenario were estimated using a dynamic, computable general equilibrium model for the province of Alberta. Results indicated that the two scenarios will have very similar impacts and may reduce the present value of GDP by as much as $4.44 billion in Alberta from 2011–2056. These findings highlight the importance of considering the economic impacts of conservation area strategies in order to minimize the trade-offs associated with achieving conservation goals.

Continuous-cover forestry is a management alternative that seeks to provide more diverse forests for continual multi-purpose benefits. Whether there is an economically-optimal equilibrium of uneven-aged forest can be tested deterministically by varying interest rate i. To answer this question, optimisation focused on maximising the net present value for the long-term period was performed using the Subplex algorithm integrated within a density-dependent stand-level matrix transition model. A regular-grid inventory of mixed uneven-aged forests in the West Carpathians, Central Slovakia, was used to parameterise the model. The results showed that a steady state can be reached that is characterised either by a near equilibrium at an i of 1% and higher, or by a continuous fluctuation at an i of 0% and 0.5%. When starting optimisation with a real stand situation with i of 2% and higher, deviations from an equilibrium state appeared both at the beginning and end of the optimisation run. The conclusion is therefore to only interpret the middle-stabilised sequence from the long-term optimisation results as a real equilibrium. Considering the individual target diameter specific for crown size and stem quality of trees within the extended matrix model improved the financial results by 7%. Crown size, representing tree vigour and growth potential, was more important for the improvement of financial results compared to stem quality related to timber price.

In September 2010, the Fourmile-Lefthand Canyon forest fire burned 6181 acres, destroyed 169 homes, and caused $217 million in property damages making it by far the most expensive fire in Colorado history at the time. This paper examines how the fire affected housing prices in vulnerable neighboring areas that were not directly impacted by the fire, controlling for the property’s level of risk. This damaging fire may have increased home owners’ perceptions about the risk of living in forested areas subject to wildfires to a significant degree adding to the total direct economic losses from the fire. Utilizing a unique fire risk data set and a difference-in-difference approach, we test whether buyers of houses in areas with different risk levels prior to the fire adjust expectations differently. We find buyers in the highest risk area are most likely to change their perceptions in response to a fire with houses in these areas experiencing a statistically significant 21.7% decline in sale price compared to houses in non-risky areas.

The emergence of second generation biofuel industries will be heavily dependent on future prices of ethanol, which could incent landowners to switch land uses from agriculture to growing biofuel feedstocks. In this study, we investigate price levels of ethanol that will be necessary for landowners to grow hybrid poplar. In such an emerging industry, landowners will face a great deal of uncertainty and will consider options to change their production decisions over time. To address this uncertainty, we construct a real options model that considers the dynamic option for Canadian landowners to switch from agriculture to poplar plantations, and also the option to sell poplar plantations for ethanol or pulpwood. The uncertainty in prices for poplar is characterized by time series models of prices for ethanol and pulpwood that characterize price variability as a GARCH process, and reversion to the long term mean average prices. Uncertainty for the value of land allocated to agriculture is characterised by a geometric random walk. Given these price processes, the real options models suggest that current average price levels would have to increase by approximately 35% (i.e. by 0.21 $/L) if only ethanol is considered as an end product, but this increase may be reduced to 32% (i.e., to 0.19 $/L) if the landowner has options to sell the poplar to either ethanol or pulpwood producers. On low value agriculture lands, estimates suggest that an 18% increase relative to current ethanol prices (i.e., of 0.11 $/L) would be needed, which is approximately equal to the current second generation subsidies in Alberta.

Private governance, in the form of certification schemes, has grown remarkably in the past decades as a response to some of the most pressing environmental and social challenges. Certification schemes denote steering mechanisms that allow enterprises to voluntarily adhere to a set of verifiable principles. While certification has global aspirations, its uptake and growth are heterogeneous across different countries. Yet, few studies empirically analyze such variation. We address this gap by focusing on the Forest Stewardship Council, a major sustainable forestry management certification program. We empirically evaluate uptake and growth across 151 countries and hypothesize that market and socio-political characteristics explain variation in uptake and growth. We find that a value-added wood industry, state-control of the forestry industry and competing certification programs, contrary to the literature, are key drivers.