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Following the Fourth Industrial Revolution, the forest industry sector now combines cutting-edge technology with other industries. Hence, the Special Classification for the Forest Industry was established to clearly define the scope of the forest industry. Therefore, we reclassify the 2018 input-output table of the Bank of Korea based on the Special Classification of the Forest Industry. Specifically, we calculate the proportion of the forest industry that contributes to the products and services of each industry and divide them into forest and non-forest industry sectors to create the input-output table of the forest industry. We find that a direct and indirect production inducement effect of KRW 193.4 million occurs when KRW 100 million is invested in the forest industry. The import inducement coefficient is 0.221 and the value-added inducement coefficient is 0.779. In the labor sector, the total workers inducement coefficient is 12.9 and the employee inducement coefficient is 8.5.

This study provides novel insights into the policy effects of timber legality verification methods, specifically Due-diligence (under the European Union Timber Regulation (EUTR)) and Due-care (under the Lacey Act), on coniferous and non-coniferous lumber trade, highlighting their significance in the context of global lumber trade. Timber legality verification plays a pivotal role in the global timber trade. We comprehensively assess the impact of verification methods on coniferous and non-coniferous lumber trade, utilizing two decades of trade data (1997–2017) across approximately 160 countries. We employ the difference-in-differences method based on the gravity model of international trade, utilizing robust export–import data and demographic profiles. Our findings demonstrate that the effect of EUTR on coniferous lumber imports ranged between −0.32% and −0.05%, and that on non-coniferous lumber imports ranged between −0.44% and −0.05%, whereas the effect of the Lacey Act on coniferous lumber imports ranged between −0.93% and −0.09%. Non-coniferous lumber imports remained unaffected. The Voluntary Partnership Agreement (VPA) led to decreased exports to the EU and US. Our findings hold two key implications. First, Due-diligence exhibits more consistent policy effects than Due-care. Second, supporting VPA-participating countries is crucial for facilitating timber trade. These insights inform timber trade policies and sustainable practices.