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A Dynamic Analysis of the Global Timber Market under Global Warming: An Integrated Modeling Approach

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  • Dug Man Lee
  • Kenneth S. Lyon

Abstract

We develop a dynamic integrated modeling approach to identify the effect of global warming on the global timber market. The Timber Supply Model (TSM) 2000, BIOME 3, and Hamburg are used as suitable economic and ecological models. In particular, the TSM 2000 is developed to incorporate important additional components in the global timber market. We estimate dynamic ecological change based on the simulation results of BIOME 3 using Hamburg and linearity assumptions about change in climate and ecosystem. The projected dynamic ecological changes are run through the TSM 2000 to identify the effects of dynamic climate change on the timber market. We simulate a non‐climate change base scenario and a climate change scenario of the TSM 2000, and we conclude that global warming has a positive effect on the global timber market through an increase of timber production causing stumpage prices to be lower than they otherwise would have been. In the welfare sense, we also identify that global warming is economically beneficial to society through the global timber market.

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  • Dug Man Lee & Kenneth S. Lyon, 2004. "A Dynamic Analysis of the Global Timber Market under Global Warming: An Integrated Modeling Approach," Southern Economic Journal, John Wiley & Sons, vol. 70(3), pages 467-489, January.
    • Handle: RePEc:wly:soecon:v:70:y:2004:i:3:p:467-489
    DOI: 10.1002/j.2325-8012.2004.tb00584.x
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    1. Peter Berck, 1979. "The Economics of Timber: A Renewable Resource in the Long Run," Bell Journal of Economics, The RAND Corporation, vol. 10(2), pages 447-462, Autumn.
    2. Sohngen, Brent & Mendelsohn, Robert, 1998. "Valuing the Impact of Large-Scale Ecological Change in a Market: The Effect of Climate Change on U.S. Timber," American Economic Review, American Economic Association, vol. 88(4), pages 686-710, September.
    3. Brent Sohngen & Robert Mendelsohn & Roger Sedjo, 1999. "Forest Management, Conservation, and Global Timber Markets," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 81(1), pages 1-13.
    4. Sedjo, Roger A. & Lyon, Kenneth S., 1996. "Timber Supply Model 96: A Global Timber Supply Model with a Pulpwood Component," Discussion Papers 10696, Resources for the Future.
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    Cited by:

    1. Johnson, Kelsey K. & Lewis, David J., 2024. "Weather variability risks slow climate adaptation: An empirical analysis of forestry," Journal of Environmental Economics and Management, Elsevier, vol. 125(C).
    2. Joelle SAAD-LESSLER & George TSELIOUDIS, 2010. "Storms, Climate Change, And The Us Economy: A National Analysis," Applied Econometrics and International Development, Euro-American Association of Economic Development, vol. 10(1).
    3. Lyon, Kenneth S., 2004. "Modeling Timber Supply, Fuel-Wood, And Atmospheric Carbon Mitigation," Economics Research Institute, ERI Series 28339, Utah State University, Economics Department.
    4. Joelle SAAD-LESSLER & George TSELIOUDES, 2009. "Storms, Climate Change, and the US Economy: A National Analysis," Regional and Sectoral Economic Studies, Euro-American Association of Economic Development, vol. 9(1).
    5. Hashida, Yukiko & Lewis, David J., 2022. "Estimating welfare impacts of climate change using a discrete-choice model of land management: An application to western U.S. forestry," Resource and Energy Economics, Elsevier, vol. 68(C).

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    JEL classification:

    • Q23 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Forestry

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