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The Effect of Decentralized Governance on Timber Extraction in European Russia

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  • Kelly Wendland
  • David Lewis
  • Jennifer Alix-Garcia

Abstract

“Good” governance is often promoted for economic growth, but its impact on natural resource use in developing and transitional economies is not well understood. For example, many scholars promote improved governance as a means to slow resource use, whereas others have found that better governance increases extractive resource activities. In this paper we use within-country variation in Russia to test the impact of governance on timber harvesting. Using a reduced form fixed-effects model and satellite-based estimates of forest cover we find a statistically significant and non-linear effect of governance on the area of timber harvested: for a marginal improvement in governance timber harvesting increases, but this effect decreases at high levels of governance. These results are robust to alternative specifications and when instrumenting for economic growth. Governance could impact timber harvesting in Russia through ownership risk (i.e., tenure security), through the costs of doing business (i.e., bribes), or both. Nonparametric regressions and qualitative evidence suggest that both factors are at play in Russia. This analysis provides additional evidence that improving governance may increase natural resource extraction. This has important implications for policy prescriptions that suggest “good” governance will slow resource use in developing and transitional economies. Copyright Springer Science+Business Media Dordrecht 2014

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  • Kelly Wendland & David Lewis & Jennifer Alix-Garcia, 2014. "The Effect of Decentralized Governance on Timber Extraction in European Russia," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 57(1), pages 19-40, January.
  • Handle: RePEc:kap:enreec:v:57:y:2014:i:1:p:19-40
    DOI: 10.1007/s10640-013-9657-8
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    2. Serge Mandiefe Piabuo & Peter A. Minang & Chupezi Julius Tieguhong & Divine Foundjem-Tita & Frankline Nghobuoche, 2021. "Illegal logging, governance effectiveness and carbon dioxide emission in the timber-producing countries of Congo Basin and Asia," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 23(10), pages 14176-14196, October.
    3. Sohag, Kazi & Gainetdinova, Anna & Mariev, Oleg, 2023. "Economic growth, institutional quality and deforestation: Evidence from Russia," Forest Policy and Economics, Elsevier, vol. 150(C).
    4. Abman, Ryan, 2018. "Rule of Law and Avoided Deforestation from Protected Areas," Ecological Economics, Elsevier, vol. 146(C), pages 282-289.
    5. Shuning Zhu & Jinlong Liu & Hao Xu & Lingchao Li & Wentao Yang, 2022. "Has China’s New Round of Collective Forest Reforms Reduced Forest Fragmentation? A Case Study of the Beijing–Tianjin–Hebei Region," IJERPH, MDPI, vol. 19(10), pages 1-15, May.
    6. Abman, Ryan & Carney, Conor, 2020. "Land rights, agricultural productivity, and deforestation," Food Policy, Elsevier, vol. 94(C).
    7. Conor Carney & Ryan Abman, 2018. "Land rights, agricultural productivity, and deforestation in Vietnam," WIDER Working Paper Series 88, World Institute for Development Economic Research (UNU-WIDER).
    8. Brusselaers, Jan & Buysse, Jeroen, 2018. "Implementation of the EU-Cameroon Voluntary Partnership Agreement policy: Trade distortion, rent-seeking and anticipative behavior," Forest Policy and Economics, Elsevier, vol. 90(C), pages 167-179.
    9. Ryan Abman & Conor Carney, 2018. "Land rights, agricultural productivity, and deforestation in Vietnam," WIDER Working Paper Series wp-2018-88, World Institute for Development Economic Research (UNU-WIDER).
    10. Kelly J. Wendland & Matthias Baumann & David J. Lewis & Anika Sieber & Volker C. Radeloff, 2015. "Protected Area Effectiveness in European Russia: A Postmatching Panel Data Analysis," Land Economics, University of Wisconsin Press, vol. 91(1), pages 149-168.

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