In recent times a need has developed within NCT for a more accurate prediction of pulpwood available from its members for supply to strategic markets. Present systems indicate the volume of timber per member per farm, however this volume has been found not to be an accurate prediction of what will actually reach the mill at the end of the day as many factors come into play and influence the volume that reaches the mill. The questions arise: which factors influence the availability of marketable Eucalyptus pulpwood timber, and to what extent do the different factors play a role? It was with this problem in mind that a comprehensive survey was undertaken to evaluate a number of factors identified and to try and determine their impact on the volume of Eucalyptus pulpwood supplied. / Thesis (M.B.A.)-University of KwaZulu-Natal, Pietermaritzburg, 2006.

The state of Uttar Pradesh occupies about 9 per cent of the total geographical area of India, supports more than 16 per cent of its 440 million people, but has less than 6 per cent of the Indian forests. It is, in many ways, an underdeveloped part of a developing nation. There is a great potential for contributions of Uttar Pradesh to the economic development of India, by the expansion of the U. P. pulp and paper industry. Per capita consumption of paper and paper-board in India is expected to increase from about 1.3 Kg in 1965 to 6.2 Kg in 2000. If the production in the country increases as anticipated in this thesis, and if more raw materials are not made available, shortages of both long-fibred and short-fibred raw materials will begin to be felt strongly by about 1975 and will progressively increase. To reduce these shortages the Uttar Pradesh Forest Department is establishing plantations of fast-growing tree species. The Mysore hybrid eucalypt is being planted to provide short-fibred pulpwood and plantations of the bamboo (D endrocalamus strict us) will yield long-fibred pulp. Present plans of the U. P. Forestry Department have not paid enough attention to growing long-fibred material. The Department should concentrate mainly on the production of long-fibred material because much short-fibred material is available as sugar cane bagasse in the U. P. It also could be secured when needed if eucalypt and poplar plantings were made by farmers. Eucalypts, pines, poplars and bamboos have been discussed regarding their suitability for production of pulpwood in the forest areas of U. P. Greatest attention has been given here to eucalypts but it is concluded that pines and bamboos are the most desirable. The need for producing within India all of the pulp and paper required domestically has been considered more important than that for supplying paper and paper-board to Indian consumers at world prices. At present It appears as if the foreign exchange conserved by reducing pulp and paper imports can be more usefully spent in buying machinery, fertilizers, and technical knowledge. India can become self-sufficient in its paper and paper-board needs after 1980 only if enough long-fibred raw materials are produced. Therefore, major trials of potentially suitable, fast-growing, long-fibred species should be established soon. The paper industry in U. P. should continually strive to improve its technology and bring down its costs of production because in the long run it will have to become competitive in world markets. The U. P. Forest Department should not judge its efficiency solely by the size of net surplus created in a plantation program. It should also consider the potential contributions of its plantations in the growth of Indian industry and improvement of real national income. Intensive economic analyses of the problems discussed here should be undertaken to refine objectives for the long-term development of U. P.'s forest industry. / Forestry, Faculty of / Graduate

Community stability in the sense of the long run survival of forest industry centres has often been declared an objective of public forest policy. It has been widely asserted that "community stability" can and does result from the practice of sustained yield forest management. Sustained yield also generally includes a requirement for an even annual flow of timber (equal to the annual growth). The implication is that stability of employment opportunities and incomes in the forest industry over shorter periods can also be attained as a result of the planned even flow of timber from the forests. This model of forest regulation has recently been defended and justified on this basis, particularly when criticism has been focussed on its obvious economic inefficiencies. It is argued here that even-flow regulations per se can not achieve the desired and anticipated effects on employment and incomes when the forest industry of a region produces primarily for a volatile export market and is also subject to economies of scale and location. However, in British Columbia, certain public policies and procedures introduced in the pursuit of technical objectives may have had substantial indirect effects on regional development and community stability through their influence on the corporate structure, geographic location and capital intensity of the forest industry. Qualitative and quantitative, (econometric) methods are used to analyse the socio-economic consequences of these changes, focusing particularly on employment - its stability, trends and location - within a defined region. It was found that the logging, processing, assembly-repair and service occupations are the most relatively unstable, and that the instability of total unemployment has been much greater in a single-industry town than a diversified city. Furthermore, employment instability in the primary wood-using industries was found to be correlated with changes in the price of lumber destined for Export markets. The conclusions emphasise that forest policies to regulate the short-run supply of timber from the provincial forests are not the most relevant to questions of stability of employment in the forest-related industries. The British Columbia forest Service does not have exclusive control over regional development or "community stability". This analysis suggests that not only reappraisal of Forest Service practices and procedures, but also of its objectives and capacity to fulfil them, is indeed long overdue. While the forest industry remains dominant in the regional economy, a wood products marketing agency or a price support scheme might contribute to community stability by buffering some of the exogenously induced shocks. However, for a number of reasons, it is considered that the most realistic prospects for attaining employment stability lie in the diversification of the regional economy. Since this cannot be accomplished costlessly, it remains to be decided by the political process how much community instability the people of British Columbia can afford and what steps they are prepared to take to attain more stability. / Forestry, Faculty of / Graduate

Indiana University-Purdue University Indianapolis (IUPUI)

The objective of the study was to determine how various capital gains tax structures affect decisions to invest in new forest investments. These effects were measured by changes in the after-tax present values of bare land under each tax structure. The three capital gains tax structures modeled were: the current federal income tax law without basis indexing, the current federal income tax law with basis indexing, and the accrued income tax with indexing. Other things equal, the direction of effects on present values of bare land of capital gains tax structures and the other factors in the model was the same for White pine Christmas trees and Douglas fir timber. Highest present values occurred with basis indexing and lowest present values were with the accrued income tax structure, in all possible combinations of the above variables. Higher present values with basis indexing were due to tax savings. Tax saving from basis indexing per dollar of cost basis increases, reaches a maximum, then decreases as the payoff period lengthens, at a given inflation rate, with all other things equal. The payoff period that maximizes tax savings per dollar of cost basis decreases, as real interest rates increase. When the capital gains tax rate is 34% and inflation rate is 5%, and when real interest rates range from 3% to 9%, the payoff period with maximum tax savings ranges from 20 to 10 years. Since most forest investments have rotations longer than 20 years, this result implies that basis indexing will probably not affect decisions about new forest investments very much. It will also not affect the timing of gains realization for capital assets, not necessarily forestry in nature only, that had already been held for longer than 20 years. Two equity criteria were considered in the study. The first criterion requires the tax to be neutral with respect to allocation of land to different uses. The second criterion requires capital gains recipients to pay, at investment maturity and with other things equal, taxes equal to the sum of annual taxes on increases in asset value (accrued income) accumulated with interest. The study showed that, without inflation, the realized income tax (the current federal income tax) is neutral with respect to allocation of land to uses with different rotations because the tax reduces the bid prices for land uses with different rotations by equal percentages, other things equal. However, with inflation, the results suggest that basis indexing is needed in order to maintain the tax’s neutrality with respect to allocation of land to uses with different rotations. Under the second criterion, a forestry example was compared with a bank account, both with equal value growth rates. It showed that taxes paid on realized capital gains at investment maturity are lower than the sum of annual taxes on accrued income accumulated with interest, given the same tax rate. Thus, the current federal income tax, which taxes capital gains upon realization, does not meet the second equity criterion. Based on this criterion, the tax favors assets that yield capital gains over assets with annual incomes. In order to meet the second equity criterion, realized capital gains should pay taxes at the ERITAX rate. The ERITAX rate, when applied to realized capital gains, gives tax revenues equal to accrued income taxes accumulated with interest to investment maturity. However, when the annual accrued income tax rate is high, or when the rotation is long, or when the timber value growth rate is low relative to the interest rate, the ERITAX rate can exceed 100% of the capital gains, thus driving some bare land values below values in alternative uses. This result is consistent with the finding that the accrued income tax is non-neutral with respect to allocation of land to different uses and is biased against land uses with long payoff periods, given the same establishment costs. Thus, when the second equity criterion is met, the tax becomes biased against land uses with long rotations. These results indicate that none of the taxes modeled can meet the two equity criteria simultaneously. Even so, among forest investments, the current federal income tax with basis indexing is the most desirable because it is least likely to distort allocation of land to forestry. / Ph. D.

In the past five years, most agricultural producers in the United States have suffered from depressed conditions in the commodity markets. The supplies of basic food commodities have burgeoned, demand has fallen, and price levels have declined, despite $55 billion in U.S. Department of Agriculture (USDA) commodity support program expenditures since 1983 (FAPRI, 1988). Since the early 1980's, farm income and asset balances have declined and debt has risen, increasing the financial stress for many producers. The financial strain could be more acute for those operators with a significant proportion of marginal land in production. Conversely, the USDA Forest Service recently projected that during the next 30-to-40 years softwood forest product demand will increase, available supplies will decrease, and real price levels will increase (USDA Forest Service, 1987). These conditions create the option of converting marginal agricultural lands to forestry investments. A technique was developed to compare possible financial returns between prevalent cropping systems and forestry investments on marginal soil series throughout Virginia. Crops and tree species used in the study include the following: corn (Mays L.), soybeans (Glycine max), soft red winter wheat (Triticum L.), orchard grass (Festuca L.), clover (Trifolium L.), fescue (Festuca L.) pasture, and loblolly pine (Pinus taeda L.), and eastern white pine (Pinus strobus). With state-of-the-art management regimen for agricultural production, annual profit or loss estimates were computed for a variety of soil productivity classes and market price levels. Intensive management was also prescribed for the forestry investment analysis. Using current inputs and projected market price levels, a cash flow analysis program computed equal annual equivalent (EAE's) values for the investment analyses to derive results comparable to those for agriculture. Under the "base" assumptions and current and foreseen markets, forestry investment was determined to be competitive with agricultural production on the marginal soil series. However, government subsidies, benefiting both forest products and agricultural production, complicate the results. Further, the dependency of both markets on macroeconomic and other exogenous variables precludes any guarantee of investment performance over the 35-to-45 year investment horizon for either alternative. The study does provide a foundation for financial comparison, to which a landowner might add individual, subjective evaluations of land use (and financial criteria and assumptions) to reach a decision about the utilization of marginal agricultural lands. / Master of Science

One approach to risk in investment evaluation is to discount expected cash flows with a single risk-adjusted discount rate. When emphasis is placed on total (as opposed to systematic) risk there are no a priori criteria guiding the proper selection of' the risk-adjusted discount rate. It is unlikely that a single rate will capture the risk differences between the investment alternatives considered. This study evaluates risk-adjusted discount rates in the context of stand-level investment decisions. The investment setting is a non-diversified risk-averse individual facing mutually exclusive opportunities in forage hay, pine plantation, and mixed pine-hardwood management. These opportunities contrast differences in cash flow, objectives, capital requirement, and presumably risk. Risk-adjusted discount rate bias was defined as the tendency to incorrectly identify a suboptimal alternative as being the most preferred. The correct ranking and valuation of alternatives was conducted using an expected utility approach to risk. The scope of the analysis was to assess to what degree, if any, does risk-adjusted discount rate bias occur in an actual stand-level investment setting. Therefore, the numerical results in the analysis pertain to a case study example and are not general enough to make definitive conclusions about the overall riskiness of forestry and hay investments. The potential for risk-adjusted discount rate bias was demonstrated in a hypothetical investment context. However, when risk was empirically estimated through simulation, risk-adjusted discount rate bias was less pronounced in the ranking of alternatives. Instead, the influential parameter was the risk-free discount rate. Based on an objective simulation of risk, which only accounted for historical variability in yields and prices, the estimated correct risk premiums in the discount rate were imperceptibly small, especially in the context of measurement error in specifying the risk-free discount rate. The implication is not that risk can be ignored, but that treating risk via the risk-adjusted discount rate approach is inadequate. More general approaches to risk are recommended, implying much research is still needed in this area. / Ph. D.

Given the neoclassical assumptions of optimizing economic agents, perfect information, perfect competition, and productive efficiency, timber supply is a dynamic process. Different discrete-time dynamic timber supply models and their solution methods are compared and their common elements derived. A continuous-time model is derived, but not solved. The discrete-time timber supply model is then incorporated into a dynamic multi-sector model and a dynamic general equilibrium model. In the multi-sector model, all household's utility functions are aggregated into a single community utility function which is maximized subject to the technology of the economy. The technology for the forest sector is the same as in the discrete-time dynamic timber supply models. Wood is treated as an intermediate input into the production of consumer goods. The technology of the consumer goods sectors is based on the technology used in computable general equilibrium models. The optimal steady state problem for this model is discussed, and the solution for an example problem is presented. Disaggregating the utility function is necessary for modeling true general equilibrium. This greatly complicates the problem of Ending numerical solutions, but enriches the model considerably. The formulation of the general equilibrium model as an optimization problem is described, but proved rather difficult to solve. The optimal steady state problem can be solved using an algorithm developed by Scarf (1967) for finding fixed points of continuous functions. The fixed-point approach provides a reliable solution method and appears to have more potential for modeling departures from perfect competition than the optimization approach. The equivalence of the two approaches is discussed. / Ph. D.

The objective of this thesis is to quantitatively understand the economic performance of protected area management strategies for forest and biodiversity conservation. Examples such as integrated conservation and development and eco tourism are assessed in terms of their ability to deliver on welfare benefits to local communities, and an assessment of the opportunity costs of forest conservation as a land use strategy. In addition the contribution of forest conservation in protected areas can make to poverty alleviation and economic development is also examined. The geographical focus of this study is the Albertine Rift region of East and Central Africa, stretching north from the southern end of Lake Tanganyika through the spine of Africa to the northern end of Lake Albert. The Albertine Rift is one of Africa’s most important landscapes for the conservation of forests and biodiversity. The overarching objective is addressed using a series of case studies empirically valuing the opportunity costs of conserving forests in a selection of sites in the central part of the Albertine Rift. The success of conservation is most often measured against progress in reducing habitat or species loss and not often in terms of the contribution of the protected area to poverty alleviation and local economic development. Achieving improvements of conservation strategies in the social dimension requires objective evidence on their effects. Economic valuation of protected area resources provides a quantitative means of assessing the promise and performance of conservation policies in achieving welfare benefits to local communities. This thesis provides three case studies each addressing current valuation and social issues in conservation and sets them in a context of managing protected areas in the broad dynamic setting of poverty alleviation and economic growth from a developing economy perspective. In addition two of the empirical studies are as concerned with methodological enquiry and the performance of novel environmental economic valuation techniques, such as the contingent valuation and choice modelling approaches, as the application of results to conservation questions. The empirical studies show that the benefits to local households and communities from their local forests may be greater than at first perceived. Across all protected area categories, biomes and income groups, households derived significant amounts of their overall income from their local protected area with large proportions of the value of goods harvested from forests being consumed in the home. Amongst income groups high income households often appropriated a greater share of the value of forest goods. There was no significant difference found between the household consumption and the sale of protected area products between income groups. The findings indicate that imposing reductions in forest use may increase poverty amongst local people whilst increasing household income will not necessarily reduce forest exploitation. This indicates that community conservation and integrated conservation and development programmes must target the poor forest adjacent households more actively to ensure poverty alleviation, whilst providing improved protection and law enforcement for effective conservation. It is also shown that biodiversity conservation can have an economic return through mountain gorilla eco-tourism. Findings show a disparity between what constitutes eco-tourism and the real values of tourists towards biodiversity conservation and local social benefits from protected areas. Despite showing a high marginal utility for biodiversity conservation, consumers are unwilling to pay for local community benefits from tourism as part of the permit price to view gorillas. Clearly the link between successful conservation and the welfare status of local communities is not sufficiently established in the minds of consumers to influence their spending decisions. The challenges of effectively mobilising communities to protect biodiversity are discussed in the context of the variable impacts of integrated conservation and development programs over the last three decades. Direct payment payments for conservation services schemes are discussed as an innovative tool to add to the gamut of community approaches currently on offer. Payments for conservation schemes are viewed with cautious optimism in terms of their possibility for success. Despite their allure of being more economically and socially efficient at achieving welfare and conservation objectives, given the complex nature of any society, no less research in to social and economic dynamics of protected area use by local communities would be needed to ensure success of such schemes. However, the overwhelming majority of benefits form protected areas are tied up in ecosystem services values. Mechanisms to generate funding and distribute payments for these benefits in terms of offsetting the local opportunity costs are essential to change local behavior and reduce forest degradation and destruction.

Thesis (MScFor (Forest and Wood Science))--University of Stellenbosch, 2005. / Like in many developing countries, forest and woodland resources contribute significantly to ensure the sustainability of livelihoods of rural people of Eritrea. However, the contribution made by forest and woodland resources has been masked due to the inability of the traditional economic valuation methods to reveal the hidden values of forest resources. As a result they do not reflect in GDP accounting, development planning and conservation policymaking. The underestimation of the importance of forest and woodland resources to the rural subsistence economy results in both market and policy failures. These in turn lead to escalated forest degradation, livelihood insecurity, value conflicts and ineffective conservation programmes. The forest and woodlands of administrative sub-zone Dighe were selected as a case study as they comprise trees, shrubs and other non-woody plants of outstanding importance both in terms of socio-economics and biodiversity richness. However, these resources are being rapidly depleted as a result of clearing for commercial agriculture and are under growing pressure due to resettlement of returnees and needs of other social actors. The study was carried out in three representative administrative areas of the sub-zone. A literature survey was carried out to identify the best of traditional neo-classical economic valuation methods to use in this study. Complementary methods from various streams of economics, ethnobotany, ecological anthropology and rural sociology were reviewed. The sub-set of selected marketable items were quantified and monetised based on market-based valuation approaches; and compared with non-marketable roles to indicate the magnitude of full values of the forest and woodland resources. Values that could not be quantified were described qualitatively. A production-consumption analysis of dom palm scrub leaf harvesting for household utensils was carried out. Forest health was investigated based on observation, semi-structured interviews and secondary information. The study revealed that local forests and woodlands provide essential goods and services for subsistence use, to generate income and to reduce vulnerability during times of hardships. Riverine forests, acacia woodlands and scattered trees and shrubs of grassland are the three vegetation types found in the study area. The riverine forest, dominated by dom palm, is a most valuable resource as it provides for multiple uses. Among the many marketable and non-marketable benefits, forests and woodlands provide wild food, construction material, livestock feed, household utensils, firewood, traditional medicine, shade, climate amelioration, erosion control, cultural heritages and scenic values. All members of rural households regardless of age, gender and wealth extract forest products, which minor variation between households and administrative areas. Variability of consumptive use values between households and between administrative areas and other non-marketable values are determined by relative wealth status, seasonality, resource availability and distribution, market outlets and local institutions. The study revealed that the riverine forests and woodland values of the Dighe administrative sub-zone alone have contributed economical values many times greater than US $ 1.43 million per annum for selected quantifiable items only. This would be higher if the other non-marketable forest values were monetised including the livestock grazing and access to watering points. Beyond any doubt, the high local values of forest and woodlands and consequently the contribution to the national economy justify the conservation of the remaining forest. Moreover, the production-consumption analyses showed that the present level of dom scrub leaf harvesting is sustainable. Forest health situation analysis indicates, however, that the entire forest is under immense pressure. Moreover, the findings of this study suggest that conserving forest resource for local values is compatible with the millennium global development agendas.