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An economic analysis of a storage policy after a storm occurrence in forestry

Author

Listed:
  • Julien JACOB
  • Antoine LEBLOIS
  • Marielle BRUNETTE

Abstract

Storm is among the main threat for European forestry generating huge economic damage. The decrease of the timber price due to the storm occurrence largely contributes to these economic impacts. Timber storage appears as the standard policy to implement in order to limit these negative impacts. Consequently, in this article, we propose a global economic assessment of a storage policy taking into account the impacts on producers, consumers and the cost of public funds. For that purpose, we develop a tractable theoretical model which assesses welfare losses and gains incurred/earned by all agents of the society (forester (supply), consumers (downstream agents), and the public agent), from the storage. The model is then simulated. Our results show that globally, the storage policy is always desirable except for the consumers in the case of storms associated with a low magnitude.

Suggested Citation

  • Julien JACOB & Antoine LEBLOIS & Marielle BRUNETTE, 2024. "An economic analysis of a storage policy after a storm occurrence in forestry," Working Papers of BETA 2024-27, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg.
  • Handle: RePEc:ulp:sbbeta:2024-27
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    References listed on IDEAS

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    1. M. Brunette & M. Hanewinkel & R. Yousefpour, 2020. "Risk aversion hinders forestry professionals to adapt to climate change," Climatic Change, Springer, vol. 162(4), pages 2157-2180, October.
    2. Brunette, Marielle & Couture, Stéphane, 2008. "Public compensation for windstorm damage reduces incentives for risk management investments," Forest Policy and Economics, Elsevier, vol. 10(7-8), pages 491-499, October.
    3. Sandrine Brèteau-Amores & Rasoul Yousefpour & Marc Hanewinkel & Mathieu Fortin, 2020. "Composition diversification vs. structure diversification: How to conciliate timber production and carbon sequestration objectives under drought and windstorm risks in forest ecosystems," Working Papers of BETA 2020-31, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg.
    4. Caurla, Sylvain & Garcia, Serge & Niedzwiedz, Alexandra, 2015. "Store or export? An economic evaluation of financial compensation to forest sector after windstorm. The case of Hurricane Klaus," Forest Policy and Economics, Elsevier, vol. 61(C), pages 30-38.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    risk; price; forest; storage.;
    All these keywords.

    JEL classification:

    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
    • Q23 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Forestry

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