The opportunity costs of forest conservation in a local economy
Costs generated by nature conservation are repeatedly under discussion. Most often the costs of conservation are estimated as aggregate figures at the national or regional level or alternatively, for a forest owner. In this study they were examined at the local level, in the forestry dependent municipality of Ilomantsi in Eastern Finland. The estimations of lost net revenues (stumpage income less silvicultural costs), wages, entrepreneurial income and profits, employment and value added were based on alternative forest management plans calculated for conservation areas. The annual losses as regards employment during the first decade were estimated to be 5.7–20.4 jobs. Later, the employment effects were estimated to be 2.4–6.3 lost jobs. Although the value added lost during the first decade was estimated to be at maximum only 3.4% of the present total value added of the municipality, the share of the value added of forestry was estimated to be higher than the mere protected forest land share would indicate. The use of conservation areas for forestry would create a moderate increase of employment in forestry, i.e. 3.8–14%, during the first decade, but it would later stabilise at a much lower level. Employment impacts at the municipal level were estimated as very small (at maximum 0.9%), but on the other hand, for some villages even single jobs may matter. The main reasons for the minor impacts were the high mechanisation rate of logging and the major flow of stumpage income outside the locality.
Received 8 March 2000 Accepted 14 October 2002 Published 31 December 2002