Urban Deforestation and Urban Development
AbstractThis paper has developed a model of a single forest owner operating with perfect foresight in a dynamic open-city environment that allows for switching between alternative competing land uses (forest and urban use) at some point in the future. The model also incorporates external values of an even-aged standing forest in addition to the value of timber when it is harvested. Timber is exploited based on a multiple rotation model a la Faustmann with clear-cut harvesting. In contrast to previous models, our alternative land use to forest land is endogenous. Within this framework, we study the problem of the private owner as well as that of the social planner, when choosing the time to harvest, the time to convert land and the intensity of development. We also examine the extent to which the two-way linkage between urban development and forest management practices (timber production and provision of forest amenities) contributes to economic efficiency and improvements in non-market forest benefits. Finally, we consider policy options available to a regulator seeking to achieve improvements in efficiency including anti-sprawl policies (impact fees and density controls) and forest policies such a yield tax. Numerical simulations illustrate our analytical results. JEL codes:
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Bibliographic InfoPaper provided by Universidade Nova de Lisboa, Faculdade de Economia in its series FEUNL Working Paper Series with number wp559.
Length: 43 pages
Date of creation: 2012
Date of revision:
Deforestation; Urban Development; Forest Management Practices; Anti-Sprawl Policies; Yield Taxes;
This paper has been announced in the following NEP Reports:
- NEP-AGR-2012-02-20 (Agricultural Economics)
- NEP-ALL-2012-02-20 (All new papers)
- NEP-CMP-2012-02-20 (Computational Economics)
- NEP-ENV-2012-02-20 (Environmental Economics)
- NEP-GEO-2012-02-20 (Economic Geography)
- NEP-URE-2012-02-20 (Urban & Real Estate Economics)
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