Natural resource accounting for Indian states — Illustrating the case of forest resources

Our main objective is to set out and apply a SEEA-based methodology to reflect the true value of forest resources in India's national and state accounts. We establish that a “top-down” approach using available national databases is both feasible and desirable from a policy perspective. In this paper, we address four components of value creation in forests: timber production, carbon storage, fuelwood usage, and the harvesting of non-timber forest products. The results of our analysis suggest that prevailing measures of national income in India underestimate the contribution of forests to income. The income accounts of the Northeastern states in particular are significantly understated by these traditional (GDP/GSDP) measures. We are also able to identify some states which performed poorly in the context of our sustainability framework, reflecting natural capital losses due to degradation and deforestation. Our results highlight the need to integrate natural resource accounting into the national accounting framework in order to generate appropriate signals for sustainable forest management and for the conservation of forest resources which are widely used by the poor in India, as well as being significant stores of national wealth.     

信息不对称、分成契约与超限额采伐--中国国有森林资源变化的理论分析和实证考察

本文回顾了改革开放以来国有林业企业管理体制的演变 ,通过多任务委托代理模型探讨了这一演变过程中利润分成和采伐限额两个不相容的政府政策激励对国有林业企业经营者激励的影响 ,特别是信息不对称条件下其对木材采伐的影响 ,从而解释了国有林业企业普遍存在的超限额采伐的经济原因。通过全国 2 8个省 5次全国森林资源普查的面板数据 ,通过使用国有林业企业的平均面积作为政府与国有林业企业委托—代理关系中信息不对称的代理变量 ,从实证上验证了信息不对称将会导致超限额采伐和国有林资源增长率下降的假说     

The role of domestic timber markets in tropical deforestation and forest degradation in Ecuador: Implications for conservation planning and policy

Studies about the impact of the timber trade on tropical forests have often oversimplified process complexity and underestimated regional variability. This study shows that forest degradation and clearing in Northwest Ecuador between 1983 and 1992 was closely linked to commercial logging. A key finding is that domestic demand is critical for shaping timber extraction and, hence, forest degradation and deforestation in this region. Low timber prices for roundwood and sawnwood at the origin, which are bolstering unsustainable forest extraction, have not been affected by market liberalization. This suggests that conservation initiatives that target international trade linkages may only be partially successful, even when they do what they are intended to do. Results suggest that market-based incentives are more likely to produce the desired results if they target and support timber producers directly. These findings are also relevant for other regions where domestic markets are a significant drive for deforestation and where local markets are supplied through the activities of small-scale, labor-intensive primary producers. Also, by emphasizing areas where logging is a dominant force, meso-level studies, like this one, not only help to more accurately estimate the impact on local forests, but also identify major resource flows and the factors promoting or hindering sustainable use, and those affecting the effectiveness of policy options.     

Economic cost of deforestation in semi-deciduous forests — A case of two forest districts in Ghana

The ecological, economic and socio-cultural roles of forests are under threat in Ghana due to the high rate of deforestation. Efforts are being made to combat this problem through rehabilitation measures. However, the costs of deforestation and restoration benefits are not adequately estimated. This paper fills in the gap in knowledge by providing an empirical estimation of the cost of deforestation in monetary terms. Primary data collected regarding timber, non-timber forest products and soils in semi-deciduous forests were analyzed using opportunity cost and replacement cost techniques. The results emphasize differences in the value of these forest goods and services lost annually. The largest losses were in stumpage fees, edible fruits, and avoided carbon emissions values. The results show that US$133,650,000 gross revenue, equivalent to 2.6% of the 2008 agricultural sector Gross Domestic Product, is lost annually. It can be concluded that restoring the degraded forest lands would bring benefits particularly to the local communities through increased stumpage revenues and harvest of non-timber forest products, as well as additional funds from carbon credits. It is recommended that stakeholders of forest resources are made aware of these costs in order to raise awareness of what they are losing through deforestation.     

刍议我国木材工业发展与生态保护

分析了我国木材工业的社会需求及其林木资源状况,指出依靠科技进步,实现木材资源的高效利用,是缓解我国木材供需矛盾、保护森林资源、维护生态平均、实现木材工业可持续发展的必由之路。     

Optimal Design of Forest Taxation with Multiple-Use Characteristics of Forest Stands

The paper studies optimal forest taxation under uncertainty about future timber price when private forest owners value amenity services of forest stands and forest stands have public goods characteristics. It is assumed that preferences of forest owners can be described by a quasi-linear, intertemporal utility function which reflects risk aversion in terms of consumption and constant marginal utility in terms of amenity services. The comparative statics of current and future harvesting in terms of timber price risk, site productivity tax and yield tax are first developed. It is shown that, given the optimal site productivity tax, which is independent of the timber harvested and thus non-distortionary, it is desirable to introduce the yield tax at the margin; it both corrects externality due to the public goods characteristic of forest stands and serves as a social insurance device. The optimal yield tax is less than 100% and depends on the social value of forest stands, timber price risk and properties of compensated timber supply. In the general case the 'inverse elasticity rule – according to which the optimal yield tax is negatively related to the size of the substitution effects – may not hold. Under certainty, the desirability of the yield tax, given the optimal site productivity tax, depends only on the existence of public goods characteristic and is thus a pure Pigouvian tax.     

Timber harvesting versus forest reserves—producer prices for open-use areas in German beech forests (Fagus sylvatica L.)

A strong demand for nature conservation can be ascertained in Germany. Several nature conservation groups argue that in order to provide nature conservation in considerable parts of the forest area forestry should sacrifice timber harvesting. For example, the abandoning of harvesting altogether is supposed to enhance and protect the species richness. This fact and the very low profitability of forestry in Germany motivated the writing of this paper. The paper explains a methodology for deriving producer prices involved in forest reserves, where harvest benefits are sacrificed totally. Such methodology can be useful to form a basis for private contracts between forest owners and nature conservationists, who demand forest reserves. The results of this methodology can also be integrated in financial programs for species and habitat conservation.In a basic theoretical consideration, it is demonstrated that a stand-by-stand evaluation approach may only serve as an initial step in deriving compensation prices for forest reserves. Due to the stochastic character of forest management, a nonlinear programming approach (NLP) was adopted to find an optimal operational plan for a hypothetical beech (Fagus sylvatica L.) forest. In both the constraints and the objective function, the nonlinearity is considered by integrating stochastic components. Additionally, only virtual homogenous forest reserves are considered. Firstly, a basic NLP solution for the hypothetical forest with the objective “maximise the net present value (NPV) of timber harvests adjusted to risk” was obtained when considering several constraints subject to stochastic variation of net revenues and timber harvests without considering forest reserves. Secondly, other solutions allowing for forest reserves were computed. The decrease of the objective function when forest reserves were increased in periodic increments seemed well suited to mirror the opportunity costs of forest reserves.The results showed that a stand-by-stand approach gave much greater compensation prices than the NLP approach. The reason for this lay in the consideration of a nonlinear objective function as well as the nonlinear constraints in the case of NLP. The first 42-ha forest reserve was priced at 11,494 Euro/ha or, 483 Euro/ha/year expressed in infinite yearly compensation. The yearly compensation price for the last forest reserve had an increase up to 607 Euro/ha/year. A stand-by-stand approach, however, resulted with compensation prices from minimally 609 up to maximally 709 Euro/ha/year.Various interest rates (3.2% and 5.2%) caused different compensation price curves. The slope of the curves increased when the interest rate decreased.The limits of the approach, the problem of deriving a demand for forest reserves and the opportunities for applying the presented approach to state forests are discussed.     

中俄木材贸易：现状、问题与对策

中俄双方木材贸易中存在交易产品质量差、交易市场不规范以及双边政策问题等。应采取加强检验工作、完善市场制度以及加强双边企业的合资合作等相应措施，坚持科学发展观，加强对俄交通基础设施和锯木厂的投资，增加可采伐的面积，扩大生产能力，从而实现中俄木材贸易的健康持续发展。     

Carbon sequestration and the optimal management of New Hampshire timber stands

This paper explores the tradeoff between resource extraction and net carbon sequestration in managing representative timber stands in the state of New Hampshire in the northeastern United States. In the absence of policies to promote forest carbon storage, land owners have incentives to employ clear-cut harvesting regimes with relatively short rotation periods. Under conservative assumptions regarding the social benefits of carbon storage, optimal rotation periods are extended by between 16 and 133 years depending on the forest type under consideration. If policy-makers pursued a cost-effective strategy to stabilize atmospheric carbon dioxide concentrations at twice the pre-industrial norm, optimal rotation periods would be extended by a full 180–347 years. The analysis suggests that partial harvesting regimes (in which approximately 35% of timber volume is removed at 15-year intervals after the timber stand reaches an initial age of 45 years) provide relatively high net benefits under a variety of circumstances. This finding is relevant because partial harvesting is an accepted and relatively common practice that could be adopted more widely.     

Assessing sustainable forest management under REDD +: A community-based labour perspective

Reducing emissions from deforestation and forest degradation plus (REDD +) encourages economic support for reducing deforestation and conserving or increasing existing forest carbon stocks. The way in which incentives are structured affects trade-offs between local livelihoods, carbon emission reduction, and the cost-effectiveness of a REDD + programme. Looking at first-hand empirical data from 208 farming households in the Bolivian Amazon from a household economy perspective, our study explores two policy options: 1) compensated reduction of emissions from old-growth forest clearing for agriculture, and 2) direct payments for labour input into sustainable forest management combined with a commitment not to clear old-growth forest. Our results indicate that direct payments for sustainable forest management – an approach that focuses on valuing farmers' labour input – can be more cost-effective than compensated reduction and in some cases is the most appropriate choice for achieving improved household incomes, permanence of changes, avoidance of leakages, and community-based institutional enforcement for sustainable forest management.     

International timber markets and tropical deforestation: the evidence from prices

Some scholars suggest that global timber markets, especially those involving high value species, are a leading cause of tropical deforestation. Despite limited empirical evidence, this hypothesis rests on the assumption that global timber markets respond to a common equilibrating mechanism that provides strong enough incentives for loggers in the tropical regions of the world. This article develops a simple model and taps into a unique data set on timber prices of hardwood and softwood in leading markets to test the global timber markets hypothesis. While we find evidence of a global equilibrating mechanism with potentially significant economic incentives to affect tropical deforestation, our results do not endorse the common conjecture in the literature that timber price shocks in developed countries lead to a homogeneous response in terms of deforestation everywhere in the tropical world. Instead, they invite further development of structural global timber market models to assess the linkages between markets and the consequences of such linkages to deforestation.     

Trade,tropical deforestation and policy interventions

Trade interventions are increasingly advocated as a means for controlling timber-related tropical deforestation. This paper analyzes the impact on deforestation of such policy instruments in a dynamic framework. The forest is modelled as a potentially renewable resource, and timber is extracted for purposes of export and domestic consumption. Optimality conditions for a variety of model specifications are derived, and the impacts of changes in the terms of trade and market structure on long-run deforestation are analyzed. The results of this analysis suggest that trade interventions that seek to affect the terms of trade against the export of tropical timber products are in the long run a second-best policy option for influencing the deforestation process.We would like to thank Joanne Burgess for contributing to discussions that resulted in this paper, which were held at the Beijer Institute of Ecological Economics of the Royal Swedish Academy of Sciences. We acknowledge the financial support given by the Beijer Institute and the hospitality of its staff, and in particular we are grateful to Prof. Karl-Göran Mäler for inviting us to use the facilities at Beijer and to Charles Perrings, Director of the Biodiversity Programme. Additional support for Edward Barbier's participation in the research was also provided by the International Tropical Timber Organization, under contract no. PCM(XI)/4, Economic Linkages Between the International Trade in Tropical Timber and the Sustainable Management of Tropical Forests. We are grateful to comments provided by two anonymous referees; however, the usual disclaimer applies.     

Structural Adjustment Programme, Deforestation and Biodiversity Loss in Ghana

An empirical investigation is undertaken into the impact of the Structural Adjustment Programme (SAP) on forest and biodiversity loss in Ghana between the period 1965–1995. In the first part of the analysis, a four-equation recursive model, consisting of forest loss, cocoa land, maize land and timber production equations, is employed to examine the impact of the SAP on forest loss. The first equation is a function of the last three, and the last three are functions of mainly prices. Piecewise linear and switching regression approaches are used to distinguish between the influence of the post from the pre-adjustment impacts. These results together with a specie-forest area relationship are used to investigate the impact of the SAP on biodiversity loss. The overall results indicate that cocoa land expansion and timber production, but not maize land expansion, are the significant causes of forest loss in Ghana. However, the impact on forest loss in the post-adjustment period was reduced. The rate of biodiversity loss also reduced in the post-adjustment period. Changes in relative output and input prices due to the SAP may have played a significant role in the reduced impact of agricultural and timber related deforestation and biodiversity loss in the post-adjustment period.     

SEQUESTERING CARBON ON AGRICULTURAL LAND: SOCIAL COST AND IMPACTS ON TIMBER MARKETS

Planting trees to sequester carbon has broad political appeal. However, effects of a major tree planting program on the agricultural sector and on timber markets are unclear. This paper examines social costs of sequestering carbon in tree plantations on U.S. agricultural land and investigates harvesting's effects on timber prices and on private timber producers' welfare. The analysis links a model of the U.S. agricultural sector that includes the land base in major production areas with a model of the U.S. softwood economy. Using current data on planting, maintenance, and harvesting costs for tree plantations and carbon sequestration rates, the models estimate the price and welfare effects of alternative carbon sequestration goals. Results indicate a range of outcomes. Consumers pay higher prices for food as farmers divert land from crops to trees. However, wood products consumers gain from falling timber prices if the trees enter commercial markets. Agricultural producers and landowners gain from higher commodity prices, but private forest owners lose. Large tree planting programs imply that policymakers must compensate private commercial tree planting to prevent farmers from displacing present tree plantations.     

Sustainability in forest management: An evolving concept

Sustainability in forest management is both a biological and socioeconomic concept. Originating in 18th century Europe with the aim of avoiding social and economic disruptions associated with timber shortages, sustained-yield forest management evolved to a highly technical process of modeling growth, mortality, and risk in order to set timber removals at a level that theoretically could be maintained in perpetuity. Changing scientific understanding of the ecological functioning of forest ecosystems has challenged the notion that a sustained yield of timber is equivalent to sustaining all the components and natural processes necessary to maintain the long-term health and productivity of these ecosystems. Continuing uncertainty over what is socially and economically acceptable, as well as ecologically sustainable, will make optimality in forest management a much more difficult objective than in the past.     

An Integrated System for Management and Policy Analysis

This paper develops an analytical framework to simulate management- and policy-driven environmental changes in Swedish mountain environments. The framework is based on a dynamic model that includes economic connections between timber and reindeer. Economic benefits are obtained in the timber sector and the reindeer sector, by harvesting forest and reindeer stocks and selling the harvests in markets. Unharvested forest and reindeer stocks provide benefits outside of markets. Reindeer stocks provide benefits by supporting the reindeer husbandry lifestyle for members of the indigenous Saami population. The paper analyzes decisions made by a hypothetical planner of a geographical area corresponding to a Swedish sameby (Saami village). Decision outcomes are measured using the present value of net benefits measured in economic terms, and are obtained both inside and outside of economic markets. The final section gives examples of management and policy decisions that might be simulated for Swedish mountain environments, such as market-based policies to increase the economic welfare derived from private timber and reindeer harvests.     

Biological capital theory: a question and a conjecture

A community possesses an empty tract of land, good only for growing trees of a particular type. What is the optimal pattern of planting and harvesting? If utility is convex in consumption it is optimal to plant and harvest periodically. If the utility function is strictly concave our numerical analyses suggest that the forest approaches a balanced state in which the rate of timber production is uniform.     

Trade-mediated biotechnology transfer and its effective absorption: an application to the U.S. forestry sector

In this paper, we analyze the consequences of biotechnology innovations in the United States forest sector (logging) by modeling technology transfer embodied in trade flows and its absorption. A seven-region, seven-traded-commodity version of a dynamic computable general equilibrium model is used to achieve this task. A 0.63% Hicks-neutral biotechnological progress in the source region (U.S.) has differential impacts on the productivity of the log-using sectors in the domestic as well as in the recipient regions. Since recipient regions' ability to utilize biotechnology innovations depends on their absorptive capacity (AC) and structural similarity (SS), we construct the AC and SS indices based on multiplicity of factors such as human capital endowments, skill content and social appropriateness of the new innovations. The model results show that biotechnological innovations in the U.S. forest sector result in a significant increase in timber production. Following the productivity improvements and its embodied spillover, wood products and pulp and paper sectors in the U.S. register higher productivity growth. The role of AC and SS in capturing technical change is shown to be evident. In the face of growing regulations on timber production from public forests, increasing productivity through biotechnology may be the most effective way to meet the consumer demand for forest products.