A forest model with an endogenous growth description and age-class structure is applied to study the impacts of potential climate policy instruments on the carbon services of privately owned and managed forests. The model describes the behaviour of a utility-maximizing private nonindustrial landowner who optimizes consumption flow, harvest timing, and the intertemporal allocation of silvicultural investments. Two policy options, one in which the landowner is granted periodic carbon rental payments and one in which the government subsidizes the costs of silvicultural investments, are studied. The rules for when the policy measures have both intended and unintended effects are derived. Using numerical examples, we demonstrate that the effectiveness of both policy options depends on the age-class structure of forests when future carbon benefits are discounted. In that case, carbon rental payments are more effective for forests with old age-class structures, while silvicultural subsidies are more effective for forests with young age-class structures.
The effects of profit and land value tax on harvesting decisions of nonindustrial private forest owners are investigated. We use a model of a utility-maximizing forest owner with amenity preferences for timber, which extends the basic two-period harvesting model to include both thinning and clear-cutting harvests. It is demonstrated that with no amenity preference, the profit and land value taxes are neutral to clear-cutting and thinning decisions. Under small to medium amenity preferences, the profit tax decreases the optimal clear-cutting volumes. However, the effect on thinning may be positive or negative, depending on the amenity preference level. The total effect of the profit tax on the shortrun timber supply is negative. The effects of the land value tax contrast with those of the profit tax. Also, a tax regime with a lowered profit tax rate combined with a land value tax is analysed. It is shown to be able to bring Pareto-improvement to a regime that uses a higher profit tax but no land value tax.
This study addresses the question of how much carbon will be sequestered in wood products during the coming decades in Finland. Using sawnwood and other wood material consumption data since the 1950s and inventory data of carbon reservoirs of wood products in the Finnish construction and civil engineering sector, we first derive estimates for the carbon reservoirs in wood products-in-use in that sector. We then extend the estimate to include all wood products-in-use. We find that the carbon pool of wood products in the Finnish construction and civil engineering sector grew by about 12% since an inventory for 2000, and that the overall estimate for carbon reservoirs of Finnish wood products in 2004 was 26.6 million tons of carbon. In building the scenarios until 2050, econometric time series models accounting for the relationship between wood material consumption and the development of GDP were used. The results indicate that the range of carbon reservoirs of wood products in Finland will be 39.6-64.2 million tons of carbon in the year 2050. The impacts of different forms of the decay function on the time-path of a carbon sink and its value in wood products were also studied. When a logistic decay pattern is used, the discounted value of the predicted carbon sink of wood products in Finland is between €850 and €1380 million -at the price level of €15/CO 2 ton -as opposed to 440-900 million euros, if a geometric decay pattern is used.
scite is a Brooklyn-based organization that helps researchers better discover and understand research articles through Smart Citations–citations that display the context of the citation and describe whether the article provides supporting or contrasting evidence. scite is used by students and researchers from around the world and is funded in part by the National Science Foundation and the National Institute on Drug Abuse of the National Institutes of Health.