%0 Research article
%T Finnish sawlog market under forest taxation reform
%A Mutanen, Antti
%A Toppinen, Anne
%D 2005
%J Silva Fennica
%V 39
%N 1
%R doi:10.14214/sf.400
%U https://silvafennica.fi/article/400
%X The stepwise transition in forest taxation from site productivity tax to  taxation of profits from timber sales was one of the major  institutional changes to impact Finnish non-industrial private forest  owners in the 1990s. In this study the effect of the forest taxation  reform on the aggregate supply of sawlogs was investigated using time  series analysis and quarterly data. In particular, we estimated two  simultaneous equations systems for the pine and the spruce sawlog  markets. According to the results, the forest taxation reform  strengthened the supply of spruce and pine sawlogs in the anticipatory  stage of the taxation reform in 1992. Also during the fiscal transition  period, which started in 1993, the supply effect of the taxation reform  has clearly been positive. The strong own-price elasticity of sawlog  supply found in this study indicates high sensitivity to actual and  expected wood price changes in the determination of sawlog supply in  Finland. Furthermore, the results indicate that the theoretical  assumption of a competitive market is suitable for the Finnish sawlog  market, but that separate analysis of pine and spruce sawlogs provides  additional insights into market behaviour.