Damned if you do, damned if you do not--Reduced Climate Impact vs. Sustainable Forests in Sweden
The main objective of this paper is to analyze the potential goal conflict between two of Sweden's environmental objectives: Sustainable Forests and Reduced Climate Impact - or, more precisely, the conflict between forest conservation and the supply of wood fuel. To accomplish this, we use a forest sector model that includes the suppliers and major users of roundwood. The econometric results, based on a data set that spans 40 years, show that all the own price elasticities have the expected signs. Among the three forestry products, the supply and (long-term) demand of forest fuel seems to be most sensitive to a price change. In a second step, the estimated model is used to simulate the effect of increased forest conservation - the Sustainable Forest objective - on the supply of wood fuel. If oil is used as a substitute, Swedish emissions of greenhouse gases will increase by almost 0.92 percent, which indicates a clear conflict with the Reduced Climate Impact objective.
References listed on IDEAS
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- Linden, Mikael & Uusivuori, Jussi, 2002. "Econometric analysis of forest conservation: the Finnish experience," Environment and Development Economics, Cambridge University Press, vol. 7(02), pages 281-297, May.
- Brent Sohngen & Robert Mendelsohn & Roger Sedjo, 1999. "Forest Management, Conservation, and Global Timber Markets," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 81(1), pages 1-13.
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- Leppanen, Jussi & Linden, Mika & Uusivuori, Jussi & Pajuoja, Heikki, 2005. "The private cost and timber market implications of increasing strict forest conservation in Finland," Forest Policy and Economics, Elsevier, vol. 7(1), pages 71-83, January.
- Runar Brannlund & Per-Olov Marklund & Magnus Sjostrom, 2004. "Evaluating market efficiency without price data: the Swedish market for wood fuel," Applied Economics, Taylor & Francis Journals, vol. 36(1), pages 31-39.
- Diewert, W. E., 1973. "Functional forms for profit and transformation functions," Journal of Economic Theory, Elsevier, vol. 6(3), pages 284-316, June.
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