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Damned if you do, Damned if you don't – Reduced Climate Impact vs. Sustainable Forests in Sweden

Author

Listed:
  • Geijer, Erik

    () (Dept of Forest Economics)

  • Bostedt, Göran

    () (Dept of Forest Economics)

  • Brännlund, Runar

    () (Department of Economics, Umeå University)

Abstract

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.

Suggested Citation

  • Geijer, Erik & Bostedt, Göran & Brännlund, Runar, 2009. "Damned if you do, Damned if you don't – Reduced Climate Impact vs. Sustainable Forests in Sweden," Umeå Economic Studies 794, Umeå University, Department of Economics.
  • Handle: RePEc:hhs:umnees:0794
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    More about this item

    Keywords

    Goal conflict; Wood fuels; Forest sector model; Roundwood markets; Forest conservation;

    JEL classification:

    • C30 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - General
    • L73 - Industrial Organization - - Industry Studies: Primary Products and Construction - - - Forest Products
    • Q41 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Demand and Supply; Prices
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy

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