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Mitigating Climate Change by Planting Trees: The Transaction Costs Trap

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  • G. Cornelis van Kooten
  • Sabina Lee Shaikh
  • Pavel Suchánek

Abstract

Land-use change and forestry projects are considered a low-cost option for addressing climate change mitigation. In Canada, afforestation is targeted to sequester enough carbon to meet one-fifth of its international obligations, and at lower cost than emissions reduction. We examine economic aspects of the institutions and incentives needed to encourage landowners in Canada to adopt tree planting on a large scale. Based on data from a survey of landowners, the transaction costs of getting landowners to convert their land from agriculture to plantation forests appear to be a significant obstacle, possibly increasing the costs of afforestation projects beyond what conventional economic analysis suggests.

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File URL: http://le.uwpress.org/cgi/reprint/78/4/559
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Bibliographic Info

Article provided by University of Wisconsin Press in its journal Land Economics.

Volume (Year): 78 (2002)
Issue (Month): 4 ()
Pages: 559-572

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Handle: RePEc:uwp:landec:v:78:y:2002:i:4:p:559-572

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Web page: http://le.uwpress.org/

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Cited by:
  1. Elberg Nielsen, Anne Sofie & Plantinga, Andrew J. & Alig, Ralph J., 2014. "Mitigating climate change through afforestation: New cost estimates for the United States," Resource and Energy Economics, Elsevier, vol. 36(1), pages 83-98.
  2. Yazhen Gong, 2010. "Integrating Social Capital into Institutional Analysis of the Guangxi CDM Forest-based Carbon Sequestration Project," EEPSEA Special and Technical Paper tp201010t2, Economy and Environment Program for Southeast Asia (EEPSEA), revised Oct 2010.
  3. Sjølie, Hanne K. & Latta, Greg S. & Solberg, Birger, 2013. "Dual discounting in climate change mitigation in the forest sector," Journal of Forest Economics, Elsevier, vol. 19(4), pages 416-431.
  4. Pajot, Guillaume, 2011. "Rewarding carbon sequestration in South-Western French forests: A costly operation?," Journal of Forest Economics, Elsevier, vol. 17(4), pages 363-377.
  5. Di Falco, Salvatore & Bulte, Erwin, 2013. "The Impact of Kinship Networks on the Adoption of Risk-Mitigating Strategies in Ethiopia," World Development, Elsevier, vol. 43(C), pages 100-110.
  6. Cacho, Oscar J. & Lipper, Leslie & Moss, Jonathan, 2013. "Transaction costs of carbon offset projects: A comparative study," Ecological Economics, Elsevier, vol. 88(C), pages 232-243.
  7. Shaikh, Sabina L. & Sun, Lili & Cornelis van Kooten, G., 2007. "Treating respondent uncertainty in contingent valuation: A comparison of empirical treatments," Ecological Economics, Elsevier, vol. 62(1), pages 115-125, April.

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