Scandinavian Working Papers in Economics

CERE Working Papers,
CERE - the Center for Environmental and Resource Economics

No 2011:12: The costs and benefits of intensive forest management

Runar Brännlund (), Ola Carlén (), Tommy Lundgren () and Per-Olov Marklund ()
Additional contact information
Runar Brännlund: CERE, Postal: Dept. of Economics, University of Umeå, S-901 87 Umeå, Sweden
Ola Carlén: Dept. of Forest Economics, Postal: SLU, S-901 83 Umeå, Sweden
Tommy Lundgren: CERE, Postal: Dept. of Forest Economics, SLU, S-901 83 Umeå, Sweden
Per-Olov Marklund: CERE, Postal: Dept. of Economics, University of Umeå, S-901 87 Umeå, Sweden

Abstract: This paper presents an approach for studying the socio-economic benefits and costs (CBA) of the introduction of intensified management measures in forestry. Besides from valuation of changes in timber production, assessments of different types of externalities are included in them assessment. The model is exemplified with the use of data from a Swedish governmental study undertaken in 2009 which present impacts on the Swedish forest sector if intensified management measures are applied on environmentally low-valued land and abandoned agricultural lands. The CBA shows that intensified management measures typically are private financially profitable. If these measures also become profitable from the society’s point of view depend on the size of the external effects including carbon balance.

Keywords: Cost-benefit analysis; external effect; timber production; carbon sequestration; fuel substitution

JEL-codes: Q23; Q42

22 pages, August 22, 2011

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