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The impact of food storage on food security is examined within the context of welfare economics. It is assumed that governments store commodities with the objective of creating stability. We show a much different result if the stockholder's objective is to maximize profit from storage activities. In this case, storage does not eliminate price instability. Producers are unaffected by instability if they use an optimal storage strategy. Further, storage on the part of producers offsets what would otherwise be the negative effect from price uncertainty. It is empirically shown that storage results in decreased variability of per capita food availability.

This paper investigates the viability of carbon offset credits created through forest conservation and preservation. A detailed forest management model based on a case study of a forest estate in southeastern British Columbia, owned by The Nature Conservancy of Canada (NCC) is used to demonstrate the challenging nature of estimating forest carbon offsets. For example, the NCC management plan creates substantial carbon offset credits because the counterfactual is that of a private forest liquidator, but when sustainable management of the site is assumed, the commercial operator would sequester much more carbon than under the NCC plan. The broader message is that the creation of carbon offsets is highly sensitive to ex ante assumptions and whether physical carbon is discounted. We demonstrate that more carbon gets stored in wood products as the discount rate on carbon rises (addressing climate change is more urgent). A high discount rate on carbon favors greater harvests and processing of biomass into products, while a low rate favors reduced harvest intensity. Further, since carbon credits earned by protecting forests may find their way onto world carbon markets, they lower the costs of emitting CO2 while contributing little to mitigating climate change.

SUMMARYIn the present study, the effect of weather on maize yields in northern China was examined using data from 10 districts in Inner Mongolia and two in Shaanxi province. A regression model with a flexible functional form was specified on the basis of agronomic considerations. Explanatory variables included in the model were seasonal growing degree days, precipitation, technological change (e.g. adoption of new crop varieties, improved equipment, better management, etc.) and dummy variables to account for regional fixed effects. Results indicated that a fractional polynomial model in growing degree days could explain variability in maize yields better than a linear or quadratic model. Growing degree days, precipitation in July, August and September, and technological changes were important determinants of maize yields. The results could be used to predict potential maize yields under future climate change scenarios, to construct financial weather products and for policy makers to incentivize technological changes and construction of infrastructure (e.g. irrigation works) that facilitate adaptation to climate change in the agricultural sector.

The optimal location and configuration of wind farms in a large region is important information for policy makers, electricity system planners and wind farm developers. The model developed in this paper uses wind resource data, population data and transmission line locations to find the configuration that produces electricity at minimum cost. Several economic and regulatory scenarios were used to demonstrate the importance of each factor in siting optimally siting wind farms. We demonstrate how gradient based optimization could be applied to discover optimal wind farm location and size. Although the use of gradient based optimization makes the model sensitive to local minima, numerical smoothing is used to reduce this sensitivity.

In light of the large volumes of pine killed in the interior forests of British Columbia (BC) by the mountain pine beetle, many forest sector participants are keen to employ forest biomass as an energy source. To assess the feasibility of a wood biomass-fired power plant in the BC interior, it is necessary to know both how much physical biomass might be available over the life of a plant and its location as transportation cost is likely to be a major operating cost for any facility. To address these issues, we construct a mathematical programming model of fiber flows in the Quesnel Timber Supply Area of BC over a 25-year time horizon. The focus of the model is on minimizing the cost of supplying feedstock through space and time. Results indicate that over the life of the project, feedstock costs will more than double, increasing from $54.60/bone-dry tonnes (BDt) ($0.039/kWh) to $116.14/BDt ($0.083/kWh).

Although there has been considerable analysis on the effects of trade measures on forest product markets, these have tended to focus on tariffs. There is growing concern about the impact of non-tariff trade measures on the global forest product sector. The objective of this study is to fill a gap and estimate trade and economic impacts of non-tariff barriers and compare them to the impacts of tariffs. Ad-valorem equivalent estimates for a set of well-defined non-tariff trade restrictions are incorporated into a global forest products trade model. Nontariff barriers are found to be less common than tariffs but have similar or bigger aggregate impacts on trade, production, producer revenues, consumer expenditures and value added as tariffs. There is uncertainty in the estimation of ad-valorem equivalence of non-tariff barriers that serves as a caveat on the results. Impacts of reducing tariff and non-tariff barriers are often different across regions and products. While not free from uncertainty, the results underscore the importance of analysing both types of trade policy and the need for continuing comprehensive trade liberalization.

1Department of Bioresource Policy, Business and Economics, University of Saskatchewan, Saskatoon, Canada, SK S7N 5A8 (corresponding author: phone: 306-966-8412; fax: 306-966-8413; e-mail: james.nolan@usask.ca). 2School of Planning, Faculty of Environment, University of Waterloo, EV1 306, 200 University Avenue West, Waterloo, Ontario, Canada N2L 3G1 (phone: 1-519-888-4567, ext. 38888; fax: 1-519 725-2827; e-mail: dcparker@connect.uwaterloo.ca). 3Department of Economics, University of Victoria, PO Box 1700, Stn CSC, Victoria, British Columbia, Canada, BC V8W 2Y2 (phone: 250-721-8539; fax: 250-721-6214; e-mail: vkooten@uvic.ca). 4Department of Land Use Economics in the Tropics and Subtropics, Universitat Hohenheim (490d), 70593 Stuttgart, Germany (phone: (49) 711-459-24116; fax: (49) 711-459-24248; e-mail: i490d@uni-hohenheim.de).

This is an appropriate time to consider the future of forestry in the Ukraine since economic reforms are perhaps at their most bdefining crossroad since winning independence from the Soviet Union 12 years agoQ (Feduschak, 2003, see also Siedenberg and Hoffman, 1999), and many of Ukraine’s neighbours have recently (May 2004) joined an expanded European Union. Polyakov and Sydor’s (2004, hereafter P&S) comments on our earlier paper (Nijnik and van Kooten, 2000) provide an interesting perspective on the issue of reform as it applies to forestry. In our response to their comments, we consider first the most important point made by P&S, and the one with which we take the greatest issue, namely, their stance that Ukraine’s forests are better protected under a Sovietstyle command and control system than under a market system. We then consider more minor points of disagreement and end with some concluding observations.

It is well‐known that institutions and social capital are important determinants of economic development, and that trust is an important component of social capital. In this paper, factor analysis and three regression models are employed to analyze determinants of trust in central and eastern European countries (CEECs). The results indicate that the rule of law, the protection of property rights, and lower levels of perceived government corruption have a positive effect on trust in agriculture.

Catastrophic natural disturbance creates a dilemma for the public forestland owner desiring to retain growing stock and salvaging some, if not all, of the damaged timber. If logging on public forestlands is conducted by private forest companies under various tenure arrangements, attainment of the government's objectives depends crucially on how companies respond to various incentives. This is a classic principal-agent (PA) problem. We investigate the PA problem in the case of catastrophic natural disturbance caused by the mountain pine beetle in British Columbia; we do so using a bilevel programming approach. The principal (government) uses harvest levels, contractual conditions, and stumpage fees to incentivize agents (forest companies) to harvest beetle-impacted pine while leaving sufficient living pine and nonpine species to ensure an adequate future timber supply. Results exploring volume-based tenures indicate that, as a response to catastrophic disturbance, the government should be circumspect in applying the three strategies unilaterally. Simply raising harvest levels to facilitate salvage is not adequate and will likely require a lowering of stumpage prices, which may lead to a reduction in government revenue. Our research also suggests that the government may wish to favor agents with established mills over those interested only in maximizing net returns from logging and selling logs on the open market.

Stochastic dynamic programming is used to investigate optimal holding of primary tropical forest in humid Costa Rica when future nonuse benefits of forest conservation are uncertain and increasing. The quasi-option value of maintaining primary forests is included as a component of investment in natural capital. Although the impact of uncertainty on conservation incentives is substantial, our results indicate that a rising trend in future benefits and compensation by the international community for beneficial spillovers are more important factors in determining optimal holdings of forest stocks. Without compensatory payments, however, further deforestation may be warranted. Copyright 2002, Oxford University Press.

We analyze the gains of public investments in range productivity when cattle compete for forage with wildlife herbivores. Ignoring extra-market values by applying conventional budget analyses leads to higher cattle stocking rates and lower overall social benefits of public range improvements. This is demonstrated numerically for public forage in British Columbia, where privately profitable cattle stocking rates on newly seeded range exceed those that are socially optimal, perhaps by as much as double depending on the assumptions one makes about marginal preservation benefits. This highlights the importance of applying dynamic optimization, bioeconomic models to analyze investments in public range. Les auteurs analysent quel gain on tire des sommes publiques investies dans la productivite des grands parcours quand les bovins et les herbivores sauvages se livrent concurrence pour les fourrages. Ne pas tenir compte des valeurs exterieures au marche en recourant a des analyses budgetaires ordinaires entraine une hausse du taux de chargement et une reduction des avantages sociaux globaux issus de la bonification des grands parcours. Il est possible d'en faire la preuve numerique avec les pâturages publics de la Colombie-Britannique, ou les parcours nouvellement ensemences supportent une population de bovins lucrative pour l'eleveur mais superieure au taux de chargement optimal socialement, parfois meme du double, selon les hypotheses qu‘on formule sur les avantages d'une preservation marginale. l'etude souligne bien qu'il est important de recourir a une optimisation dynamique, soit d'utiliser les modeles bio-economiques pour analyser les sommes investies dans l'amelioration des pâturages publics.

Although economic analysis can be used to argue for preservation of species and habitats, many natu- ral assets represent inferior investments in society's asset portfolio. We demonstrate this for the case of ancient temperate rainforests and minke whales ( Balaenoptera acutorostrata ). For both rainforests and whales, we deter- mined their value for harvest and balanced this against society's valuation of the preserved stock. For the market and nonmarket data available, we then determined how much rainforest and how many minke whales global society should keep in its asset portfolio. Although ecologists increasingly attempt to justify preservation of biolog- ical assets on economic grounds, we argue that this might be a dangerous approach to take. Ultimately, it may be necessary to reexamine the ethical foundations for conservation of nature and biodiversity, including the econo- mist's use of utilitarianism. We suggest that the safe minimum standard approach may prove useful in practice. Ciencias Economicas, Especies en Peligro y Perdida de Biodiversidad Resumen: A pesar de que el analisis economico puede ser utilizado para argumentar la conservacion de es- pecies y habitats, muchos riquezas naturales representan inversiones inferiores en el portafolio de riqueza de la sociedad. Demostramos que este es el caso de bosques lluviosos templados antiguos y las ballenas minke ( Balaenoptera acutorostrata ). Determinamos el valor de cosecha tanto para los bosques lluviosos como para las ballenas y balanceamos contra el valor de su conservacion para la sociedad. Con los datos viables de mer- cado y no mercado, determinamos cuanto bosque y cuantas ballenas deben ser mantenidas en el portafolio de riqueza. A pesar de que los ecologistas intentan cada vez mas justificar la conservacion de valores natu- rales con bases economicas, arguimos que esta puede ser una aproximacion peligrosa a seguir. Ultimada- mente, podria ser necesario re-examinar los fundamentos eticos para la conservacion de la naturaleza y la biodiversidad, incluyendo el uso utilitario del economista. Sugerimos que la aproximacion de estandar min- imo seguro puede resultar muy util en la practica.

Most contingent valuation studies focus on total willingness to pay (WTP) as a measure of welfare change. For policy involving species preservation, however, it is important to distinguish between the benefits of preventing a species from going extinct and the benefits of preserving numbers above the minimum viable population (MVP) level. Once MVP is exceeded, marginal WTP becomes relevant. These propositions are illustrated for the case of one charismatic species whose management is much debated, minke whales in the Northeast Atlantic Ocean. It is shown that, for a given estimate of total preservation value, strict conservation and extinction can both be optimal. This finding highlights the importance of collecting marginal values in contingent valuation surveys.

A hierarchical approach to forest planning is formulated, where harvest schedules are first determined, followed by a decision about harvest methods (harvest regime). Choice of harvest methods is particularly important because of concerns about harvest‐related site disturbance. In the decision model developed in this article, determination of a harvest regime is expressed as a multiple‐objective decision incorporating maximization of net present value and minimization of cumulative site disturbance for different site classes, subject to maintaining high levels of production, an even flow of timber, and avoiding adjacency violations. The search for preferred harvest regimes is performed interactively over a set of non‐dominated harvest schedules with alternative aspiration levels identified for the various objectives to reflect values of different stakeholders.

Although wind, hydro and solar are the most discussed sources of renewable energy, countries will need to rely much more on biomass if they are to meet renewable energy targets. In this study, a global forest trade model is used to examine the global effects of expanded demand for wood pellets fired with coal in power plants. Positive mathematical programming is used to calibrate the model to 2011 bilateral trade flows. To assess the impact of increased demand for wood pellets on global forest products, we consider a scenario where demand for wood pellets doubles. Findings indicate that production of lumber and plywood is likely to increase in most of the 20 model regions, but outputs of fibreboard, particleboard and pulp will decline as these products must compete with wood pellets for residual fibre. Ultimately, policies promoting aggressive renewable energy targets cause wood pellet prices to more than double in our scenarios, which could increase the cost of generating electricity to such an extent that, in some regions, electricity producers will continue to use fossil fuels as their primary fuel, while some others might find it worthwhile to rely more on nuclear energy for base load power.

This study investigates the potential to predict monthly wildfires and area burned in British Columbia's interior using El Niño Southern Oscillation (ENSO). The zero-inflated negative binomial (ZINB) and the generalized Pareto (GP) distributions are used, respectively, to account for uncertainty in wildfire frequency and area burned. Results indicate that a four-month lag of the ENSO index has a strong positive influence on monthly wildfire occurrence. Upon fitting the GP distribution with a logit model regressed on the ENSO index, we predict the probabilities that monthly area burned exceeds 1700 ha and find that risks of large fires are significantly higher in northwestern BC. However, the ENSO is likely unable to provide consistent predictions of the total area burned in any month. Sensitivity analysis indicates that increases in the mean value of the monthly ENSO index result in a small increase in the predicted number of fires and an increase in the probability of large burns. This study has several implications for decision-making regarding firefighting budget planning and insurance for firefighting expenditures.

Global climate change is about uncertainty related to ecological and economic processes, and political responses. It is about fairness and income distribution among nations, both now and in the future. It is a dynamic problem that involves national carbon transition functions, damage functions and discount rates. These issues form the basis of the current paper, which examines them from a conceptual point of view.

This study examines the costs and benefits of preserving old-growth forests in British Columbia. Estimates of the present worth of old growth in timber production are compared with the measurable non-timber benefits from preserving old-growth, with the differences between the commercial timber and measurable non-timber values attributed to the unmeasured components of non-timber values. Economic efficiency benefits are then compared with benefits that accrue in other accounts used to analyze decisions. For reasonable values of non-timber values, current levels of wilderness protection (and thus of old growth) are more than adequate on the Coast, but an increase in wilderness area of 1.6 million ha (or some 80,000 ha of old growth) might be economically justifiable. Key words: economics and preservation of wilderness, protection of old growth, multiple accounts analysis

The role of renewable energy is examined within the context of global energy markets. As an alternative to fossil fuels in generating electricity, wind energy turns out to be the most viable of renewable energy options because of its lower costs. But there remain two obstacles to wider penetration of wind energy: (1) Without large subsidies or mandates, there is little incentive for private firms to invest in wind generating capacity, which results primarily from government programs. (2) Wind’s intermittency militates against its use in lieu of coal or nuclear energy for base-load power generation. Overcoming these obstacles remains a challenge.

We developed a decentralized decision support system for forest management with a central coordination mechanism. It consists of (1) an LP model, a forest estate simulation model, and a geographic information system linked in an iterative process, at the regional level, and (2) a provincewide central coordination mechanism using a system of charges and subsidies that reflect provincewide values in regional decisions. Each of the components of the decision support system can be used independently, but their linkages provide the facility to deal with the complex pattern of interactions between subsystems and the global system of the forest resource. To date, the simulation and the geographic information system have been implemented for use in a commercial forest neighboring Mount Revelstoke and Glacier National Parks.

Most previous stochastic dynamic programming (DP) applications have assumed that decision makers are risk neutral; however, risk permeates both intrayear and interyear relationships in most DP problems. Incorporating risk aversion to intrayear outcomes alone can violate the independence assumption of expected utility and can destabilize long-run equilibrium returns. Aversion to riskiness of the long-run returns suppresses the effect of sequential resolution of risk over time. Because tolerance of short-run versus long-run risk varies in dynamic situations, procedures for incorporating risk aversion should accommodate this variation. More research on risk averse DP formulations is needed.

More than half a million hectares of productive forest land in British Columbia have gone out of production because of inadequate reforestation following timber harvesting or destruction of the forest by insects or fire. Investments in reforestation of this backlog, not sufficiently restocked forest land are an important instrument of regional development in British Columbia. In this paper, economic efficiency losses associated with various allocations of reforestation funds among three regions of the province are examined. Income distributional weights are imputed for these regions based upon the allocation of reforestation monies. The results indicate that economic inefficiencies may arise from overinvestment in reforestation and from ignoring economic criteria in the prioritization of sites for treatment. However, there is evidence that the opportunity costs associated with regional equity concerns are not large.

This paper examines a pilot project of NAWMP that encourages farmers to promote or maintain waterfowl habitat by relying not only on economic incentives but on awareness, education, and moral suasion. The pilot project relies on farmers' attitudes to keep payments low because project payments substitute for grain program subsidies, thus constituting a transfer from Canadian taxpayers to U.S. contributors to NAWMP. A survey instrument and regression analysis are used to examine attitudes, economic incentives, and willingness to pay and willingness to accept compensation for modifying land use in order to conserve waterfowl habitat. The results indicate that current economic incentives offered to agricultural producers are inadequate because they ignore nonmarket costs, and that a positive attitude toward habitat preservation cannot be used as a substitute for monetary incentives.

Activities that remove CO2 from the atmosphere and store it in forest and agricultural ecosystems can generate CO2-offset credits that can thus substitute for CO2 emissions reduction. Are biological CO2-uptake activities competitive with CO2 offsets from reduced fossil fuel use? In this paper, it is argued that transaction costs impose a formidable obstacle to direct substitution of carbon uptake offsets for emissions reduction in trading schemes, and that separate caps should be set for emissions reduction and sink-related activities. While a tax/subsidy scheme is preferred to emissions trading for incorporating biologically generated CO2 offsets, contracts that focus on the activity, and not the amount of carbon sequestered, are most likely to lead to the lowest transaction costs. Key words: carbon sequestration, transaction costs, climate change

Monte Carlo simulation is used to compare the expected net returns and relative riskiness of alternative cropping strategies in Saskatchewan. The strategies include traditional fixed rotations and flexible ones that have been recommended by researchers. Three important conclusions follow. (a) Flexcropping based on available soil moisture at seeding time is the most profitable cropping strategy. (b) However, the value of measuring spring soil moisture depends crucially on the level of confidence the decision maker has in these measurements. (c) Finally, simple flexcrop strategies based on a break-even formula are an effective extension tool, perhaps more so than those found using dynamic optimization.

In this paper, a trade-off function between net returns and soil quality is developed for farmers in southwestern Saskatchewan using a Markov decision model. The results show that farmers who are concerned with soil levels or stewardship employ chem-fallow more often at lower soil moisture levels and also tend to crop more intensively to conserve soil. The major conclusion is that concern for soil quality, as documented by some researchers, does have practical significance in changing agronomic practices; but, when soil is relatively deep, it takes a fairly substantial concern about soil quality before it is possible to distinguish clearly the agricultural practices of farmers who are truly concerned with stewardship from those who are not.

In this paper, creation of carbon offset and emission reduction credits are examined from the perspective of the Little Red River Cree Nation (LRRCN), a forest tenure holder in northern Alberta. Carbon credits are produced under three scenarios: (1) carbon uptake in forest ecosystems, with postharvest waste left on site; (2) carbon uptake in forests and products; and (3) carbon uptake in forests with harvested fiber used for energy production. A mathematical programming model is used to solve for the minimum prices that cause the LRRCN to include production of carbon credits in its forest management and post-harvest processing strategies. If LRRCN is paid according to its costs of creating carbon credits, it will opt to use fiber for forest products as this provides the greatest earning potential. If LRRCN faces a fixed price for carbon credits, it will produce fiber for generating electricity in lieu of coal as this strategy has the lowest average cost. However, when costs of feedstock transportation and construction of a power plant are taken into account, carbon uptake in biomass and forest products turn out to be more competitive.

The emphasis on pure economic explanations for economic development has recently shifted to cultural, social and institutional factors. An ordinary least squares (OLS) regression equation is used to examine the relationship between deforestation and economic, institutional and social capital variables for 117 countries. Institutional, economic, and social capital variables are significantly related to deforestation, although there is no evidence to support the existence of an environmental Kuznets Curve (EKC). While the results cannot be used to discuss any one country specifically, they do provide insight into the general roles of social and institutional factors in deforestation.

Marine reserves are considered to be a central tool for marine ecosystem-based management in tropical inshore fisheries. The arguments supporting marine reserves are often based on both the nonmarket values of ecological amenities marine reserves provide and the pragmatic cost-saving advantages relating to reserve monitoring and enforcement. Marine reserves are, however, only one of a suite of possible policy options that might be used to achieve conservation and fisheries management objectives, and have rarely been the focus of rigorous policy analyses that consider a full range of economic costs and benefits, including the transaction costs of management. If credible analyses are not undertaken, there is a danger that current enthusiasm for marine reserves may wane as economic performance fails to meet presumed potential. Fully accounting for the value of ecological services flowing from marine reserves requires consideration of increased size and abundance of focal species within reserve boundaries, emigration of target species from reserves to adjacent fishing grounds, changes in ecological resilience, and behavioural responses of fishers to spatially explicit closures. Expanding policy assessments beyond standard cost-benefit analysis (CBA) also requires considering the impact of social capital on the costs of managing fisheries. In the short term, the amount of social capital that communities possess and the capacity of the state to support the rights of individuals and communities will affect the relative efficiency of marine reserves. Reserves may be the most efficient policy option when both community and state capacity is high, but may not be when one and/or the other is weak. In the longer term, the level of social capital that a society possesses and the level of uncertainty in ecological and social systems will also impact the appropriate level of devolution or decentralization of fisheries governance. Determining the proper balance of the state and the community in tropical fisheries governance will require broad comparative studies of marine reserves and alternative policy tools.

During the late 1980s/early 1990s, voluntary forest certification emerged as a new market-based incentive mechanism and had an important influence on the way the world's forests are managed. To understand the mechanism of its diffusion, we employed a survey instrument and probit regression analysis to investigate certification of forest practices by Canadian companies. Specifically, we investigated the characteristics of firms that have considered certification and of firms that have formally manifested their intention to certify. Three major forest certification schemes are considered: (1) ISO 14001, (2) the Canadian Standards Association, and (3) the Forest Stewardship Council. We find that a firm's type of tenure holdings, reliance on export markets, size, and the local community are important factors in explaining why forest companies consider certification.

Recreational fi sheries around the world provide humans with important economic benefi ts because people derive well-being from participating in the act of fi shing. Many of these benefi ts are diffi cult to value, however, because they are nonmarket in nature and depend on ‘free’ ecological services. Other sectors of society may also depend on these public goods. It is diffi cult to exclude people from using public goods and there is, therefore, a tendency for them to be under-produced by the private sector. Thus, there is often a need for government policy intervention to ensure the adequate production of public ecological services and resolve confl icts over their use. Policies that affect recreational fi sheries have costs and benefi ts, both for anglers and people in other sectors of society, that must be accounted for if social well-being is to be maximised. Economics can be used to quantify the costs and benefi ts of various policy options available to society, and make recommendations that improve overall economic effi ciency. Overall well-being (welfare) consists of the sum of ‘surpluses’ accruing to producers and consumers. In this chapter, we outline the principles of economic cost–benefi t analysis of market and nonmarket values for recreational fi sheries using examples from various jurisdictions. We also consider how economic analysis can be used to account for the transaction costs of fi sheries management – costs often borne by society as a whole – for different forms of governance.

We analyse the effects of technological change in agriculture on forest clearing by households in developing countries. The possible effects are found to be many and diverse, depending on the type of change and the institutional context. We conclude that agricultural intensification is certainly not the panacea that some believe it to be.

Land-use change and forestry projects are considered a low-cost option for addressing climate change mitigation. In Canada, afforestation is targeted to sequester enough carbon to meet one-fifth of its international obligations, and at lower cost than emissions reduction. We examine economic aspects of the institutions and incentives needed to encourage landowners in Canada to adopt tree planting on a large scale. Based on data from a survey of landowners, the transaction costs of getting landowners to convert their land from agriculture to plantation forests appear to be a significant obstacle, possibly increasing the costs of afforestation projects beyond what conventional economic analysis suggests.

In large parts of Africa, wildlife herbivores spill over onto private lands, competing with domestic livestock for forage resources. To encourage private landowners to take into account the externality benefits of wildlife, game cropping is increasingly considered as an important component of conservation policies. In this paper, we employ a bioeconomic model of a private game ranch to examine five potential government policies concerning wildlife conservation, ranging from (strict) preservation to uncontrolled exploitation. 'Intermediate' policies appear to contribute most to wildlife conservation, with costs to landowners of such policies being modest. The model outcomes support recent wildlife policy shifts in Kenya.

The Kyoto Accord on climate change requires developed countries to achieve CO2-emissions reduction targets, but permits them to charge uptake of carbon (C) in terrestrial (primarily forest) ecosystems against emissions. Countries such as Canada hope to employ massive afforestation programs to achieve Kyoto targets. One reason is that foresters have identified large areas that can be afforested. In this paper, we examine this forestry option, focusing on the economics of afforestation in western Canada. In particular, we develop marginal C uptake curves and show that much less land is available for afforestation than would be the case if economics is ignored. We conclude that, while afforestation is a feasible weapon in the greenhouse policy arsenal, it might not be as effective on an economic basis as many forest-sector analysts make out. Key words: Climate change, economics of afforestation, Kyoto Accord

The economy of the Ukraine is in transition from a communist command-and-control to a capitalist system. In this paper, we describe the current state of its forest resources, the structure of its forestry and wood processing sectors, and the problems facing policy makers. While the forest sector should be, and still has the potential to become, an engine for economic growth, the combination of past exploitation and the slow pace of economic reform are major obstacles to implementing rational forest policies. Given the right economic incentives and appropriate forest policies, it may still be possible for the Ukraine to improve its future timber supply while enjoying environmental benefits from its forests. However, this requires economic and institutional reforms beyond the forest sector.

The effects of climatic changes on the sustainability of the wheat economy of southwestern Saskatchewan are examined. A crop yield-climate model is estimated and then used to project yields under a double-CO2 atmosphere. Even when a CO2-fertilization effect and technical change are taken into account, the projections indicate there will be a decline in yields. This decline is worsened if weather variability were also to increase. Given the marginal nature of crop production in the region to begin with, it is likely that crop production in large parts of the region will cease; the wheat economy of the region is not sustainable and government policies need to be developed with this in mind.

A distinction is made between the economic benefits of recent BC forest policies and their income distributional consequences. Changes in employment and tourism are examples of the latter, while economic surpluses accruing to recreationists and citizens as passive-use values are an important form of economic benefits. Recent controversies about the contingent valuation method for detemining passive-use values are reviewed, as are estimates of the values residents attach to the protection of forest amenities in BC. It is argued that constantly updated estimates of annual nonmarket values can be used as an economic indicator of forest sustainability, to be compared against the sustainable rent from logging operations. Key words: Indicators of economic sustainability in forestry; contingent valuation of forest amenities; recreation benefits and tourism

This paper provides an overview of Canadian climate change policy. It is argued that voluntary action will contribute little to climate change mitigation and that forest management strategies can, at most, contribute some 7.5 percent of Canada’s required Kyoto CO2-emissions reduction target. To do so requires tree-planting subsidies, which are inefficient locally and globally. In the arena of land-use change and forest strategies, Kyoto’s Clean Development Mechanism offers a more efficient alternative to domestic strategies

This paper examines the assignment of functions over natural resources and environment between the federal and provincial governments using the Breton-Scott (1978) approach to the optimal assignment of functions and, alternatively, studying the actual policy outcomes under the existing assignment of powers. On theoretical grounds, provincial control over natural resources is warranted as long as the external costs imposed on other jurisdictions are small, but the theoretical approach does not unequivocally assign powers to either the provinces or Ottawa. In practice, as illustrated by examples, natural resource policies are driven not by concern over social costs and benefits, but by political considerations that impose added costs on the economy.

In their comment on our paper 'Potential to Sequester Carbon in Canadian Forests,' R.M. Horbulyk and W. Ross take issue with our results on three counts: they claim: (1) Canadian reforestation policies are not a cost-effective means of sequestering carbon (C); (2) Canada cannot be considered a C sink; and (3) Canada should look beyond its borders for cost-effective CO2 abatement strategies. We began this research expecting to confirm Horbulyk and Ross' three premises, particularly the hypothesis that sequestering C is not a cost-efficient means to reduce C accumulation in the atmosphere. The research changed our minds. We will address each issue in turn below.