Joseph Buongiorno. (2015). Income and time dependence of forest product demand elasticities and implications for forecasting. Silva Fennica vol. 49 no. 5 article id 1395. https://doi.org/10.14214/sf.1395

Keywords: modeling; structural change; econometrics; markets

Highlights: Elasticities of demand with gross domestic product and prices were stable over time and income level for sawnwood and particleboard only; Other product elasticities differed with income and time, leading in conjunction with a sector model to higher projected world demand and prices than obtained by ignoring differences between countries and over time.

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In view of improving multi-country forest sector models, this study investigated to what extent the price and income elasticity of demand for forest products had changed in the past two decades, and how much they depended on the countries income level. For each of seven major product groups annual observations were divided between high-income (top 20% in gross domestic product per capita) and low-income, and between recent (2004–2013) and older (1992–2003) observations. The results indicated that for sawnwood and particleboard the data could be pooled across all countries and years. For the other commodity groups (veneer & plywood, fiberboard, newsprint, printing & writing paper, other paper & paperboard), there were statistically significant differences in gross domestic product or price elasticity between high and low-income levels or old and recent observations. Efficient elasticities were obtained by pooling the maximum number of observations while respecting the statistically significant differences. The resulting GDP elasticities were the same, or very close, across income levels for all products. The price elasticities differed by income level only for newsprint and for veneer and plywood. International forest sector projections to 2065 obtained with these elasticities compared with those based on pooling all data across time and income levels gave less than 3% difference for world consumption of sawnwood, particleboard, fiberboard, and newsprint, but 19% higher consumption for veneer and plywood, 31% for printing and writing paper, and 18% for other paper and paperboard. The world price was 1% to 11% higher for end products and 3% to 22% higher for raw materials and intermediate products.

Buongiorno, University of Wisconsin-Madison, Department of Forest and Wildlife Ecology, 1630 Linden Drive, Madison, WI 53706, USA E-mail: jbuongio@wisc.edu

article id 913, category Research article

Han Zhang, Joseph Buongiorno. (2012). Markets, government policy, and China's timber supply. Silva Fennica vol. 46 no. 4 article id 913. https://doi.org/10.14214/sf.913

Keywords: market; China; supply; policy; land reform; econometrics

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China's domestic demand and exports of wood products are rising rapidly compared to domestic supply. The determinants of timber supply in China were investigated with panel data from 25 provinces from 1999 to 2009. The results indicated that China’s timber supply had responded to both market forces, reflected by timber prices largely determined by world demand and supply, and to government policies expressed by production quotas and the tenure reform on collective forestland. The price elasticity of China’s timber supply was estimated at 0.31±0.12. The inelastic response of production to the quota (0.20±0.02) suggested that government had a limited, though significant, control of timber supply. Other things being equal, the land tenure reform increased timber supply by 18±8 percent, where and when it had been implemented.

Zhang, Research Center for Resource Economics and Environment Management, Northwest A&F University. No. 3 Taicheng Road, Yangling, Shaanxi, China 712100 E-mail: hz@nn.fi
Buongiorno, Department of Forest and Wildlife Ecology, University of Wisconsin-Madison, Madison, WI 53706, U.S.A. E-mail: jbuongio@wisc.edu

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