September 1995 

Southern Research Station 

P.O. Box 2680 

Asheville, NC 28802 
Global Change and Forestry 

Socioeconomic Studies from the 

1994 SOFEW Meeting 

Technical Editor 

J.E. de Steiguer 

Foreword 

The papers published in this volume were originally presented 

at the 1994 Southern Forest Economics W-orkers (SOFEW) 

Annual Meeting held in Savannah, GA. Together, they made 

up a special session at the SOFEW conference. The topic of 

this session was the socioeconomic impacts of global climate 

change on forestry. This research was sponsored in part by 

the USDA Forest Service's Southern Global Change Program 

(SGCP) located at North Carolina State University in Raleigh, 

NC. Ed de Steiguer, former Deputy Director of the SGCP, 

was organizer of this special session. The manuscripts have 

undergone only minor revision since the SOFEW meeting. 

Contents 

Page 

*.* fibreword ................................ in 

J.E. de Steiguer 

Timber Market Impacts of the Climate Change Action Plan ....... 1 

J.E. de Steiguer 

An Exploratory Study of the Economic Impacts of Climate Change 

om Southern Forests: Preliminary Results ............... 5 

Diana M. Burton, Bruce A. McCarl, Darius M. Adams, 

Ralph Alig, J.M. Callaway, and Steven M Wznnet 

The Value of Biophysical Information for Assessing the 

Economic Impacts of Global Climate Change ............. 19 

James 7'. Gunter, Donald G. Hodges, and James L. Regens 

A Value-Based, Multi-Scalar Approach to Forest Management ..... 29 

R. Gordon Dailey, Jr., and Bryan G. Norton 

Regional Changes in Land Uses and Cover Types: Modeling Links 

between Forestry and Agriculture .................. 37 

Ralph J. Alig, Darius M. Adams, and Rzchard W. Haynes 

Timber Market Impacts 

of the Climate Change Action Plan 

Abstract 

A timber m&et model for southem pine 

how a &-shed tree planting initiative 

The benefiu'c 

.4 to 1. The benefig~ost ratio for the hmpage 

owners is 2.2 to 1, the market benefit"co& ratio to hqaying mnsumers is 0.7 

to 1. However, the trees are likely to be haflrested well before maeum 

carbon sequestrdion pomtiai is attained. Two approaches to improving 

carbon sequeslsation potential include restriGting harvest to longer rotations 

on private land or planting on national forest lands where harvest age is 

already restricted by law to cubation of mean annual increment. 

The Action Plan 

In October 1993, the Clinton-Gore adrninistsation issued The 

Climate Change Action Plan (the Plan). The purpose of the 

Plan is to reduce greenhouse gas emissions in the United 

States to 1990 levels by the year 2000. Aaording to the Plan 

(Clinton and Gore 1 993), reducing greenhouse gas emissions 

will prevent changes in the global climate system, raising of 

sea levels, inmdation of coastal areas, damage to ecowerns, 

and destabilization of agricultural production. The 

intellectual foremer of the Plan was the Earth Summit 

Conference held in Rio de Janeiro, Brazil, in 1992. The 

principal objective of the Earth Summit was to stabilize 

greenhouse gas concentrations in the atmosphere. 

The Plan states that no single remedy for reducing gree&ouse 

gas emissions exists. Accordingly, the nds 

to use some 50 initiatives in all sectors 

reduce emissions of and ehmce sinks for peenhouse gases 

such as carbon dioxide, methane, nitrous oxide, and 

hydrofluorwasbom. In addition, the goal is to ac&eve these 

reductions in a manner &at will not h 

The Forestry Initiative 

bong the 50 initiatives in the Plan. is one to accelerate the 

plmting of forests on no~dustrial private lands to sequester 

carbon emissions. The appasent goal is to plmt 81 5,500 

acres on private lands from 1995 to 2000. Ths plmting will 

mur in stages: 23,300 acres in year one, 46,600 in year ~wrt, 

93,200 in year three, 1 86,400 in year four, and 23 3,000 acres 

in both years five and six. The program to plant the trees will 

be delivered under cunrent USDA Forest Service and State 

Forester delivery systems. The USDA Forest Service will 

provide technical evaluations and assistance under the 

Stewardship hcentive Progrm. Under the cost-share 

agreement in this progrm, the Federal govemmt will pay 

up to 75 percent of planting costs. Recently, USDA tree 

plmting cost-shae prsgarns have accounted for about 

435,000 acres planted mually. Since 1975,72 percent of 

the cost-share acres have been in the Southeastern U.S. 

This tree planting initiative should reduce emissions by 0.5 

of carbon equivalent. Due to the life-cycle growth of 

the trees, this carbon reduction will be most visible, according 

to the Plan, in the years after 20 1 5. The Plan estimates that 

the market impact will be $40 million (1 99 1 dollars, 

undiscounled) in private investment or about $50 per acre. In 

addition, positive economic impacts will be realized through 

payments to tree nurseries, forestry consultants, and tree 

planters. 

The Problem 

The Plan sets the market hpact at the value of the private 

capita1 investment induced by the cost-sharing mangement. 

In effwt, the flow of private invesMent capital is seen as a 

benefit. Tn fact, this cash flow is an iate cost to private 

landomers in exchange for %We b for evqone. The 

portion of the cost-share papnts, estimated at 

$120 ~llion ( about $150 per acre), is an bdiate cost to 

smiety. The true long-term benefjtts to all parties will amme 

in two forms: (1) as reduced envirommtal daage from 

atmospheric carbon and (2) as &read merchantable wood 

in the foresw seetor ofthe economy. This paper explores the 

fatter by estimating changes in producers and consmers 

surpluses in timber mxkeb resulting from increased .wood 

kntories. Some thoubb on the carbm sequestration 

potential ofthis tree planting initiative will also be provided. 

mu@ Progrm Manager, Southern Global Change Pro 

Research Sbtioq USDA Forest Service, Raleih NC. 
Measuring Market Impacts 

to estimate the impact of additional tree 

planting on the timber market is based on the following 

premise: additional forest inventory causes a shift in the 

supply h~~on; this shift lowers stumpage price; and the 

lower price generates marginal harvest increases. At some 

point in time, the periodic marginal harvest increases will 

remove an area of forest equal to the area originally planted. 

In each harvest period, the changes in economic surpluses 

resulting from these supply shifts and increased harvests can 

be cdculated. These economic surpluses, discounted to the 

present, are the measure of the market benefits of the costshare program. 

These surpluses are illustrated in Figure 1, which depicts an 

idealized annual timber market. Market demand is labeled D, 

and initial market supply is labeled S. The quantity demanded 

is a negative function of timber price, while tirnber supplied is 

a positive hction of timber price. The market is in initial 

equilibrium where S intersects D, yielding an annual harvest 

of q* at price p*. The original consumer surplus is equal to 

area g. The original producer surplus is equal to area f+a. 

Standing timber inventory is an undepicted variable in the 

supply function. It is used as a proxy for the cost of supplying 

timber (Jackson 1 983). An increase in timber inventory 

reduces timber supply cost, thus shifting supply outward to S'. 

The new equilibrium yields an annual harvest of q' and a price 

of p'. Consumer surplus is now equal to g + f + e + d. 

q' q* Quantity 

limber 

Producers surplus is equal to a -I- b + c. Thus, both consuer 

and producer surpluses change when timber inventorfi 

increases. Quite clearly, consumer surplus increases by f + e 

+ d. For producers, the picture is not so clear. Producers lose 

area f, but gain b + c. These opposing effects result &om a 

decrease in stumpage price (from p* to p') occurring 

shultaneously with an increase in harvest quantity (from q* 

to q'). The net eEit on producer surplus is indeterminate 

without fixther analysis of a specific market situation. 

Following a similar analysis of technological change in Just 

and others (1 982), it is anticipated that the supply curve sh& 

will result in overall gains in surplus. 

The full impact of the cost-share tree planting program or the 

timber market will require many harvest periods to run its 

course. During the first harvest period (year one of timber 

merchantability), the additional inventory of cost-share 

planted trees shifts the supply curve (S to S'). This, in turn, 

generates a marginal increase in harvest (q* to q'), which is 

deducted from inventory. The new inventory amount 

becomes the initial inventory for period two. The period two 

inventory is grown for another year; the supply curve is 

shifted; and the resulting harvest increase is deducted to form 

the initial inventory for period three. The process continues 

for each harvest period until the 81 5,500 acres (the original 

cost-share planted area) is harvested. The present value of 

the economic surpluses for all periods is computed by 

discounting them individually back to the year of the origmal 

planting and summing to determine the overall impact of the 

Plan's tree planting initiative on the timber market. 

Models and Assumptions 

A model was developed to calculate the impacts of the 

Mstration's tree planting program on the timber market. 

Called the Southern Pine Aggregated Market Model 

this single computer model combined equations, 

tables from other studies. Southern pine 

savvthber and pulpwood market equations were taken from 

an (1 987). Calculating econo~c surpluses was based 

on some of the methods developed by Hohes (1 992). A 

loblolly pine growth and yield model was taken &om Mqb 

and Sterniee (1 979). A regression equation to separate 

yield estinnates into pulpwd versus sawimber was 

developed using data from loblolly pine yield tables (Forbes 

1 96 1) and an equation p by Aveq- and Bwharl 

(1 983). The phcipal S equations follow: 

Figure 1---An hame in timber inventory causes on outward sM3 in the 

timber supply hnclion. 
The inverse maket equations (Neman 1987): 

Saw-thber demand: Pd = 93 9.7 - .0003 162Qd 

Sawtimber supply: Ps = -239.82 + .0003255Qs 

Inventory elasticity (%A Qfi A I) = .387 

Pulpwood demand: Pd = 25 3.7 - .000 1 1 Qd 

Sawthber supply: Ps = -289.8 + ,0002032Qs 

Inventory elasticity (%A QPh A I) = 1.198 

The loblolly pine yield equation (Murphy and Sternitike 

1979): 

where 

V = cubic feet volume per acres 

SI = site index 

A = stand age 

BA =. basal area 

The equation to estimate product separation: 

SAWROP =: EXP(.783667 - 49.23 15A-I), 

where 

SAWROP = proportion of stand in sawtimber 

A = stand age. 

The equation is restricted so SAWROP cannot exceed 1 .O. 

In order to implement SPAMM, several assumptions were 

made. The following assumptions are the most crucial: 

All plantings will take place in the Southeastern U.S. 

* All plantings will be loblolly pine 

* Harvesting will begin at a stand age of 20 years 

* Newan's equations based on 1950-1 980 data will 

describe the southern pine smpage markets into the 

men@-f~st cenw 

* Trees were planted on all 8 15,500 acres in a single year 

A real discount rate of 4 percent 

* Supply curve shifts were parallel (constant costs) 

A site index of 62 and a basal area of 70 for all 

shulations; both are representative of average 

conditions for the southern pineries 

Finally, all forest owners were free to sell their timber 

Results 

The SPAMM results (table 1) indicate that after 45 years of 

simulated harvesting, 8 16,024 acres of southern pine have 

been cut solely in response to the hventory-indueed supply 

curve shifts. This is an amount nearly equal to the original 

8 1 5,500 acres planted. Thus, if harvesting began at age 20, 

all the timber would be eliminated at the ma~m standage 

of 65 years. 

As anticipated, the overall result was a positive combked 

surplus. Producer and consumer surpluses (table 1) show 

positive changes in both the sawtimber and pulpwood 

markets. Sawtimber market surpluses were about equal to 

those in the pulpwood market. More pulpwood was 

harvested than sawtimber; however, the pulpwood ulas 

harvested sooner, thus the effects of discounting were 

reduced. The sawtimber was more valuable per unit volume, 

yet it occurred fiuther in the fiture thus increasing the effects 

of discounting. 

To gain perspective on the magnihde of the surplus changes, 

the changes in combined producer-consumer surpluses were 

also computed as a percentage of average annual total surplus 

in the two product markets. As table 1 indicates, the relative 

magnitudes of the surplus changes were small, and the total 

averaged only about 3.7 percent of the annual timber market 

total surplus. 

Table 1-Acres of southern pine harvested, changes in 

present value of producer (PS) and consumer (CS) surpluses 

in millions of 199 1 dollars, and total surplus changes as a 

percentage of average annual pine timber market producer 

and consmer surpluses after 45 years of timber hmesting 

Sawtimber Pulpwood Total 

Acres 

Harvested: 26 1,520 554,504 8 16,024 

Present value of surplus changes (1 99 1 $ millions): 

Producers $44.4 $44.4 $88.8 

Total changes $87.6 $85.6 $173.2, 

Total changes 

as a percent of 

average annual 

PS+CS: 2.5% 7.7% 3.7% 
'Ilxi-e maket benefitiinvestment cost @/GI ratios were 

coquted: one for prducers, one for answers, and one for 

the total progm. The present value ofprdu~er swlus was 

considered to be the market benefit accming to producers as a 

result offieir $40 million hvestment. Consuer susplus 

present value was considered to be (he market benefit 

ammhg to toe general taxpaying public as a result of their 

$120 nnillion hvesment. The results (table 2) indicate that 

the overall program is profitable (1.4 to I). Private smpage 

prduws, realizing a BIC ratio of 2.2 to I, do we11 on their 

capital. However, the return to taxpayas is negative because 

the eonsuer surplus generates a BIC ratio of 0.7 to 1. 

Table 2-ForesQ progrm market benefitiinvesbent cost 

PIC) ratios computed as the present value of economic 

surpluses relative to invested capital 

Benefits I Costs BIG Ratios 

Produces swludpr?ivate hvesbent 2.2/1 

Consmer sqlu 0.711 

Total surplusitotal investment 1.411 

Carbon Sequestration Potential 

Althou& tbis shdy did not wmpute the cabon sequestration. 

potential ofthis cost-shwe tree planting ~tiative, itis 

possible to speculate on that result. The most eacient forest 

mmagemetnt scheme for carbon sequestration would mst 

of tobl cabon a~mulation on the forest site is identical to 

the rate ofmerchmtable wd god. 

A ca~ual UPspe~tion cafmerclzmtable riolme yield tables for 

prdably occurs when a stmd is beween. 60 

age; ;the exact age is dqendent on site hdex. Hawever, 

results, mst offiese stands will be 

ent mount offorest land will 

is at(alined. Tkrefore, the 

net hp(aet on exbon seques&ation couM be negligrble. 

g that the sole objectim ofthe tree plmtkg linitlative 

is to enswe that cabon sequestration does wcw, hmestin 

e reshcted mtil cu 

ve to this approah 

of National Forest lmd where 

sts ase alredy legally constrained to the cu 

Literature Cited 

H.E. 1983. For& measurmmts. 3rd ed. New 

=to% J.; are, Alber% Jr. 1993. I*he climate change action 

plan. ofthe Raidat. Washinipton, LC. 50 p. 

Forb- RD. 1961. F 

yield table. New Yo&: Swiew 

bs: 3-24. 

Hahe% T.P. 1992. Econo&c eEe& of air pollution darnage to U.S. for&. 

In: J.E. de Skiper, ed. The ewazodc hpiaict of&& pllu~on on timber 

&: hdies from North h&ca md Europe. Gm. Tech. Rep. SESack& D.N. 1983. Sub-regonal timber demand analyses: rmarks and an 

approach for prediclion. Form Ecology and Management. 5: 109- 

118. 

Jmq RE.; Watlt, D.L,; RWlz, A. 1982. &plied welfwe econo~cs and 

public policy. Englewood C18s, NJ: fimtice-Hall, hc. 49 1 p. 

Mqky* P.k; Sted*, H.S. 1979. Growth and yield eslhation for 

loblolly pine in the W& Gulf. Res. Pap. SO-1 54. New Orlea, LA: 

culbre, Forest Service, Southean Forest 

N D.R. 1987. iln econome~c malysis of the souLhm mAwd 

amp- mdd: 1950-1980. For- Science. 33(4):932-945. 
y of the Economic 

Diana M. Burton, Bruce A. McCarl, Darius M. Adams, 

Ralph Alig, J.M. Callaway, and Steven M. Winnett 

Abstract 

A multiperiod, regional, mathematical programming model was used to 

assess the economic impacts of global climatic change on the southern 

forestry sector. Several climatelbiological response scenarios were 

developed and evaluated. Changes in the supply of timber and forest 

products induced by climate change interact with demand for wood and 

wood products to generate economic impacts, measured as changes in 

consumer and producer surpluses over time. The model and scenarios 

are described and information is drawn together on the sensitivity of 

model results to scenarios, Directions for further research are 

suggested. 

Global climate change could have an impact on forests and 

forestry in the United States. Regions in the United States 

my be differentially affected. Forecasts of climatic change 

and the biological response to climate change in trees and 

forests are still largely hypoth&ical. Though much research 

is being done on aspects of climate change and biological 

response, conclusions are still preliminary. 

This experiment seeks to dhension the potential economic 

irnpcts by considering some hypothetical biological 

responses to climate change. For this exploratory study, 

scenarios are not based directly on cbtic descriptors, but 

consider hypothetical changes in forest growth rates and in 

establishment costs that might result from climatic 

changes. Pre results for econodc impacts are 

assessed in terms of prduction, price levels, and economie 

welfare. 

Burton and McCarl are Assistant Professor and Professor, respectively, 

Texas A&M University, College Station, TX; Adams is a Professor, 

University of Montana, Missoula, h4T; AIig is a Research Economist, 

Pacific Northwest Research Station, USDA Forest Service; Corvallis, 

OR; Callaway is a Consultant with RCGfHagler billy, Boulder, CO; 

and Winnett is a Forest Policy Analyst, U.S. Envimmental Protection 

Agency, Washington, DC . 

Literature 

Relevant literature can be divided into three categories. 

Several recent studies have explored the possible impact of 

climate change on the agricultural sector (e.g . , Ab arxl 

others 1990; Kme ad others 1992). In general, these 

studies combine hypothesized climatic scenarios with 

infodion d assumptions about the biological response of 

annual crops to temperature, precipitation, ancl aospheric 

composition changes to determine yields and the resulting 

economic market impacts. Articles have considered 

impacts at the fann level (e. g . , Kaiser and others 1993), the 

national level (e.g., Adams and others 1990), and the 

international levels (e.g., Reilly and Wohmann 1993; Tobey 

and others 1992). 

In forestry, the extent of knowledge concerning the 

biological response to climate change is more limited. 

Short-term experimental results have not yet been validated 

for the life of the tree. Also, little is known about how the 

response of an individual tree to cWic changes 

generalizes to stand d forest levels. Response of the 

forest as a whole is most important for the analysis of forestsector-supply changes and resulting economic consequences 

In this second litefahrre category, a number of studies have 

sequestration in forests as a way of 

economic impacts of 

ted States have been 

others (1993) and Haynes 4 

others (1994) and in C Van Kooten and others 

assessment of economic 

for mitigaing the build-up 

of atmospheric carbon dioxide is presented in Alig and 

others (in press). 
f 5 percent and 1.5 percent incrmes 

together with increases or decreases of 

in both countries benefit but that 

Global Cbate Chmge 

The change in global climate considered in this study is that 

~ucd by irracrming concentrdiom of &moaphenc CO,. 

Climatic descriptors used in the literature generally come 

from general circulation models (GCM ' s). These models 

are large and complex and disagree on predicted clirnate for 

a doubling of CO,. Adams ad others (1990) and Kaiser 

and others (1993) comment on the disparity of predictions 

and the sensitivity of results to the climatic descriptor 

chosen. Robock and others (1993) forrnally compare the 

prdictiom of five GCM's for use in impact analysis and 

find results highly sensitive to the GCM used. 

However, models generally agree that the 

will be greatest in the northern d tempe 

rn area may experience a 

e or a slight decrease in 

prsipitation. The northern laltitucles ad other areas in the 

United State6 may experience a rise in tenvperature and no 

chaoge or a sliglat laicrease in 

others 19.80; Memo arur2. 

1992). In addition, a pot 

from increriscxt eoncentmtiom of CO, (Sdjo d Solomon 

1989). 

Tbe mdel us& for this study is the formtry sector of the 

d others 1988). FASOM es tbe present value of 

the sm of the eeono~c su~plwes. The mdel forecmts 10 

deed-; d the kst five, through 2040, are report4 bere. 

For purposa of these exploratory foreeats, prdefmd 

FASOM regions of the United States were aggregatsd. The 

South included the Southeastern ad South Central U.S. 

The North ineluded the l?ac&c Northwestern States and the 

Northeastern U.S. Other regioas aggreg&d the rem&g 

States, these regions were specifid along approximate 

IditudW d regional lines. 

genous variables in FASOM are public cut, 

s international trade flows, d forest products 

ded ~mders. These variables are generated in the 

Timber Assessment Market Model (TAMM) 

Haynes 1980). Variables edogenous to FASOM include 

harvest levels (acres) d prduction (mcf) for industrial 

d nonindustrial private foresters, market prices, d 

timber harvesting decisions. Softwoodl arxf hardwood 

products considered are sawtimber, pulpwood, and 

fuelwood. 

IP1veaior;)v existkg at the mdei's swkg decade was 

delsd separately from stock planted during the mdel run. 

differently, identical changes in the rate of tree grovrth were 

assum& for this study. FASOM c 

ernent intensity ad 

aggregate thbrld 

assessment system (ATLAS) mills and Kiocaid 1992). 

Scenarios 

idered eight possible s 

chge eKw@. They were 

dhemion the potential hpct of 

r evalwe the eEeets of acrossthe-bod changes in tree grovvth rates, or y ielrt, ea~b 

deed@, Thw , these yield chga are compdscl over the 

decdes. The fist se . psfulatw aa hcrme of 5 

went in tree gro~h rat= everywhere in the U~tecl Shtes. 

The seeolovdl postuIatm ars across- ciecrwe La 

growCh rates of 5 prcent. Two comider mtiod 

growth rate chgw of plus 10 prcent d minus 10 

percent. 

rent latides in the Unit4 Shtes. 

slight dwIine in precipitalion, 

yields in the Southern U.S. 

At the same the, yields in the No&hem U.S. my ~se, 

Therefore, a plr of southem dwhe seemrios were 
comtructecl, One pstulates a 5-percent decline in yield in 

the South, a 5-percent increase in the North, ad no chge 

in other regions. A seeod southern decline sc 

explores the hpct of a 10-percent dmrease in the South, a 

10-percent lincrease in the North, anct no change in other 

regions. 

s were comtructed to evaluate the impact 

of increased establishment costs in the South, with no 

change in the North or other regions. Increased temperahre 

ad decreased precipitation in the South may increase the 

modty of very young trees, resulting in increased stad 

establishent costs. One scenario hypotheshes a doubling 

of costs in the South; a second considers a tripling of stand 

establishment costs in the South. 

Scenario Results 

Forest Roducts Production 

Figures 2 aod 3 prment some results for forest prducts 

production in the across-the-board increasekfeche 

0s. At the top of each figure is a bar chart for the 

southern region; below ruc; charts for the northern region 

and the other regions. When growth rates rise 5 percent 

natiodly, production of forest prducts teacis to shift 

slightly to the North and to the other regions when compd 

to the base scenario. %en grod declines 5 percent, 

production shifts to the South slightly when compmec3 to the 

base scenario. 

These patterns are more evident in figure 3, which portrays 

results for a 10-percent inGrease and a 10-percent decline in 

national yields. The magnitudes of the changes are slightly 

larger. However, none of the four scenarios shows any 

substantial variation from the base scenario in forest 

products production. 

Base Scenario 

Figure 4 shows production results for the southern decline 

scenarios. When growth rates dmhe 5 percent in the Figure 1 contains a graphical description of some key South, rise 5 percent in the North, and do not change in variables in the base scenario. Production of forest products other regions, production moves slightly from the South to in the United States over the next five decades shows a the North in the last decades of the forecast. When the 

general increase in the southern region, a fall in northern changes are 10 percent, the pattern is slightly more 

production until late in the forecast period, d a fairly pronounced. steady decline in the rest of the country. Acres harvested 

(fig. 1) reflect a similar pattern, furst rising and then Increased warming and less precipitation in the South may declining in the next century. Inventory levels, softwood increase mortality of very young trees, causing 

and hardwood cornbind, Over the next establishment costs to rise Two scenarios - -- ball century. hypothesized a doubling and a tripling of stand establishment 

costs in the southern region. Figure 5 shows prduction The patterns of harvest and production evident in the base results from these scenarios. Increased stand establishment 

scenario are probably the result of interactions between the costs cause a very slight shift of production away from the 

age class distribution of the initial regional inventories and South. The variation in results over the decades is probably the te coditiom. In addition, in a WheWical due, in part, to initial age class distributions. progrdg model, a s chge in relative prices can 

s in activity levels or, in this case, 

production levels in the various regions. 

The woaonUc welfare bar chrt in figure 1 shows the 

present value of the surn of economic surpluses in the mdel 

discounted to 1990. Domestic commer surplus (DCS) is 

by far the largest share of total welfare. Domestic prducer 

surplus is DPS. The surplus attribubble to the public cut 

that of dometic producers. Foreign 

surplus (Fbr) is not visible. urplus is attributable to 

the present vahe of &el t concXitions (Tern), 

h general, when yields rise nationally, the North g ' 

sli&tly. men yields decline natiody , the South gains. 

Wea yiel& shift away from the South, prdwtion rises in 

the North and other regions. Men costs rise in the South, 

prduction sWs to other regions. 

Price Levels 

Figures 6 and 7 show the price level indices for all eight 

s relative to the base scemrio, Consumer p~ces 

d prdueer prices are dyzd 

pattern of change in response to s 

are ssar. As expected, art inGr a 

fall of real prices relative to the base sc 
Produc 

Base Scenario 

Decades 

a North ~South~Other 

Hawes 

Base Scenario 

Inventory 

Base Scenario 

Decades 

Economic VVe 

Base Scenario 

Decades 

Figure: 1-me base scenario. 

DPS For Total 
Produc 

Southern Region 

Decades 

Northern Region Other Regions 

Decades Decades 

Figure 2-Regional production for 5-percent national yield chanp scenarios. 
Produc 

Southern Region 

Decades 

Northern Region 

70000 I 

Decades 

Other Regions 

Decades 

Figufe 3-Regional production for 10-percent national yield change scenarios. 
Produc 

Southern Region 

1990 ' 2000 ' 2010 ' 2020 ' 2030 ' 2040 

Decades 

Northern Region 

70000 , 1 

Decades 

Other Regions 

Decades 

Figure &Regional production for southern yield decrease scenarios. 
Production 

Southern Region 

" 

' 1990 ' 2000 ' 2010 ' 2020 ' 2030 ' 2040 

Decades 

Northern Region Other Regions 

Decades Decades 

Figure 5-Regiornal production for increase in sourhem eshblishment cost scena6os. 
Consumer Price Indices 

Relative to Base Scenario 

Consumer Price lndices 

Relative to Base Scenario 

Producer Price Indices 

Relative to Base Scenario 

Producer Price Indices 

Relative to Base Scenario 

Decades 

Pipre &--%ce indices for national yield change scemrlorr. 
Consumer Price Indices 

Relative to Base Scenario 

95 J ' 1 I I I I 

t9'w 2h 2d10 20'20 20'33 zd40 

Decades 

Consumer Price Indices 

Relative to Base Scenario 

95 J 1 I , t !QbO 2dX 20'10 20k0 2030 2&0 

des 

Producer Price Indices 

Relative to Base Scenario 

Producer Price Indices 

Relative to Base Scenario 

Figure ?-Price indices for southern yield decrease scenarios. 

120 , 

115 ....- ......................... 

........................................................................ 

120 

"4 

95 -' I I I I I* 95 I I 1 I I I J 

19b0 2h 2d10 2020 2030 2d40 idw 20bo 2610 20'20 20130 2020 

Decades Decades 

115 

110 

X 

.. 

..... ........-..........--..................-......-.- 

u 

- 

105 

100 

.. 

...... ..-.- 
When the increase is 5 percent, real prices fall by roughly 3 

percent over the 50 years. When the incrme is 10 percent, 

rd prices fall by roughly 6 percent over the 50 years. 

When growth rates fall, red prices rise relative to the base 

. A 5-percent decline in yields results in abut a 

4-percent gain over 50 years and a 10-percent dwline results 

in an %percent rise in real prices over the base scenario. 

The southern decline scenarios both result in a real price 

rise. In figure 7, a 5-percent decline in southern growth 

rates, coupled with a 5-percent rise in yields in the north 

leads to about a 2-percent rise in price levels. The yield 

changes do not offset because volume is much higher in the 

South. Thus, the southern cfecline dominates the markets. 

Similarly, a 10-percent decline in southern yields, coupled 

with a 10-percent increase in northern yields leads to a 4- 

percent overall increase in price levels. 

An increase in the establishment costs of stads in the South 

has the biggest impact on price levels. Relative to the base 

scenario, a doubling of establishent costs in the South, 

with no cbge in costs in the North or other regions, Ids 

to a 10-percent increase in price levels over the 50 years. A 

tripling of establishmeat costs results in price level increases 

of just under 20 percent relative to the base scenario. A 

change in southern costs has a marked impact because the 

volume of timber production in the southern region is 

relatively large. 

Welfare Effects 

Figure 8 shows percentage change in the present value of 

total welfare for each of the eight scenarios relative to the 

base scenario. Basically, when yields increase overall, the 

economic surpluses in the model increase. When yields 

decline overall, economic welfare also falls. When yields 

decline in the South, even with increased growth rates in the 

northern region, total welfare falls because the volume of 

production is so large in the South. Tbis also explains why 

established cost increases in the southern region cause 

werare to fall. However, no change in total welfare is 

larger than 1 percent of the weEare in the base sceko. 

In figure 9, the suPpluses of domestic consumers atxl 

producers is dyzed sepately. When yields rise 

natiooally, consmers gain. When growth rates fall, they 

lose. The largest decline ia domwtic consumer suqlm is 

causad, by increased s establishent costs in the South 

but is still less than 4 prcent of the consuer surplus in the 

rducers lose when yields rise 

s, they gain su~lw relative to 

change, an increase, oecurs 

rise in the South. 

their surplus in the base s 

costs triple. 

The welfare hpcts in these markets are governed by the 

relative elasticities of supply 

ers are taken from T 

the global climate change scenarios. We the percentage 

changes for producers may seem high, comumers 

experience a greater present value dollar impact because 

consumer surplus is large relative to other economic 

surpluses in the model. 

Summary and Conclusions 

The results of this exploratory study show that regions of the 

Urzitd States rnay be affected differently by global climate 

change. If yields increase nationally, the Northern U,S. can 

produce relatively more forest products. If yields decrease 

nationally, the Southern U. S. can produce more. If yields in 

the South decline while they rise in the North, production of 

forest products is projected to shift away from the South. If 

stand establishment costs rise in the South, production can 

shift away from the South. 

Changes in producer and consumer prices relative to the 

base scenario are fairly sd in magnitude. When southern 

costs rise, price levels increase more subs~tially. 

The economic welfare impact of these global climate chaage 

scenarios is sd-less than a 1 -percent change from the 

base scenario for all eight hypothetical cases, In general, 

when yields rise, comumers gain. When yields fall or costs 

rise, prducers gain. 

should not be large. er, regions of the corntry my 

experience different change impacts. There will be 

effects on prices, which will cause changes in related 

markets. 
Economic We 

Variance from Base Scenario 

- 5 % All 

Scenailo 

Economic Welfare 

Variance from Base Scenario 

-.-...-.-.- ........ - 

.-..-... ...........- 

-1O%S 3 EC S 

Scenario 

Fi~m 8---aonomic welfare for all scenarios. 
Domestic Consumer Wel 

Variance from Base Scenario 

-10 ' I 

I I I 1 I 

+ 5 %~ll + 10'%All ' 

I I 

-5%S I 2 EC'S I 

- 5 % All - 10 %All -lo%§ 3ECS 

Scenario 

Domestic Producer Welfare 

Variance from Base Scenario 

+ 5 %All ' + lO'%All -5%S 2 tC 5 

- 5 % All - 10 %All -1O%S 3 EC S 

Scenario 

Figure Wonsumer and producer surpluses for all scenarios. 
of these eight hypothetical scenarios will 

rdt in a Wer derstanc2ing of potential 

In dition, a more cornpl 

at more hlly mmu~g potential cbtic 

be developed. These scenarios should be 

descriptors taken from EM'S and 

variations in growth rates over time, 

Work is currently undernay to endogenize important 

forestry sector variables, such as international trade flows, 

that are exogenous in this version of the model. Trade with 

C& is especially important to incorporate endogenously 

into the model. The impact of changing public harvest 

decisions under global climate chge and potential 

government programs needs to be assessed. 

The sensitivity of results to certain aspects of model 

construction or specific variables needs to be explored. The 

magnitude of the impact of terminal conditions and the initial 

age distribution of inventory on model pedo 

various scenarios need to be evaluated. An exploratory look 

at the potential impacts of radical changes in demand, 

perhaps a result of carbon sequestration programs or future 

shifts in technologies which radically impact the demand for 

wood, should be assessed. 

The FASOM mode1 (Adams and others 1994) will be an 

important tool in the understanding of global climate change 

impacts on the forestry sector. The eight hypothetical 

scenarios considered in this prelu?wuuy analysis suggest 

some dimension andl direetion of potential climate change 

impacts. 

Acknowledgment 

The authors acknowledge the Southern Global Change 

Program of the USIIA Forest Service for Wing and the 

U.S. Environmental Protection Agency for permission to use 

the model. The authors also thank Cladio Sousa for the 

research assistaace he provided. 

Literature Cited 

Adams, D.M.; Aiig, R,; Cahway, J.M. [and others]. 1994. Forest 

and agricultural sector optimization model: model description. 

Report on file at U.S. Envimmental Pfotection Agency, Climate 

Change Division, Washington, D,C . 

, D.M.; Callaway, J.M. [d others]. 1993. 

Sequestering carbon on agricultural land: social cost and impacts on 

timber markets. Contemporary Policy Issues. XI:76-87. 

Adams, R.M.; R-&, C.; Peart, R.M. [and others]. 1990. 

Global climate change and U.S . agriculture. Nature. 345(17 

May):2 19-224. 

Alig, R.; AWs, D.; Haynes, R. 1995. Regional changes in land uses 

and cover types: modelling links between forestry and agriculture. 

In: Global change and forestry: socioeconomic studies from the 1994 

SOFE'?? meeting; 1994 March 28-29; Savannah, GA: Gen. Tech. 

Rep. SE-93. Asheville, NC: U.S . Department of Agriculture, Forest 

Service, Southern Research Station. 

Brooke, A.; Kedrkk, D.; Meeraus, A. 1988. GAMS: a user's guide. 

South San Francisco, CA: The Scientific Press. 289 p. 

Haynes, R.; Alig, R.; Moore, E. [In press]. Alternative simulations of 

forestry scenarios involving carbon sequestration. Portland, OR: 

U.S. Department of Agriculture, Forest Service, Pacific Northwest 

Research Station. 

Kaiser, N.M.; Rh, SJ.; Wi, D.S. [and others]. 1993. A farmlevel analysis of economic and agronomic impacts of gradual climate 

warming. American Journal of Agricultural Economics. 75 :3 87-398. 

Kane, S.; Reilly , J.; Tobey, J. 1992. An empirical study of the 

economic effects of climate change on world agriculture. Climatic 

Change. 21:17-35. 

Meaillo, J.M.; WGuire, A.D.; D.W, [ad sthers]. 1993. 

Global climate change and terrestrial net primary production. 

Nature. 363 :(20 May):234-240, 

Milk, J.; Kinmid, J. 1992. The aggregate timberland assessment 

system-ATLAS: a comprehensive timber projection model. Gen. 

Tech. Rep. PNW-281. Portland, OR: U.S. Department of 

Agriculture, Forest Service, Pacific Northwest Research Station. 

Reilly, J.; Hohma~.~~, N. 1993. Climate change and agriculture: the roIe 

of international trade. American Economic Review. 83(2):306-312. 

Rind, D.; Rosenzweig, C.; Goldberg, R.. 1992. Modelling the 

hydrological cycle in assessments of climate change. Nature. 358(9 

July):119-122. 

Robock, A.; Two, R.P.; Harwd, M.A. [and others]. 1993. Use of 

general circulation model output in the creation of climate change 

scenarios for impact analysis. Climatic Change. 23:293-335. 

Sedjo, R.A.; Solomon, A.M. 1989. Climate and forests. In: Rosenberg, 

N.J. [and others], eds. Greenhouse warming: abatement and 

adaptation. Washington, DC: Resources for the Future. Chapter 8. 

Tobey, J.; Reilly, J.; Kane, S. 1992. Economic implications of global 

climate change for world agriculture. Journal of Agricultural and 

Resource Economics. 17(1): 195-204. 

Van Kooten, G.C. 1990. Climate change impacts on forestry: economic 

issues. Canadian Journal of Agricultural Economics. 38:701-710. 

Van Kooten, G.C.; Arthur, L,M, 1989. Assessing economic benefits 

of climate change on Canada's boreal forest. Canadian Journal of 

Forest Research. 19: 464-470. 

Van Kooten, G.C.; Arthur, L.M.; Wilson, W.R. 1992. Potential to 

sequester carbon in Canadian forests: some economic 

considerations. Canadian Public Policy. XVJII:2: 127- 13 8. 

Adarns, D.M.; Haynes, R.W. 1980. The 1980 soffwood timber 

assessment market model: structure, projections, and policy 

simulations. Forest Science Monograph 22. 62 p. 
The Value of Biophysical Information for 

Assessing the Economic Impacts of 

Global Climate Change 

James T. Gunter, Donald G. Hodges, and James L. Regens 

Abstract 

Global climatic change has become a major policy and scientific issue during 

the past decade. This study was designed to identifl the biological data 

required to evaluate the economic impacts of climate change on forestry in 

the Southern U.S. The primary data needs include changes in the range of 

commercially important tree species, changes in tree productivity and wood 

formation, and changes in the incidence of forest pests. 

Introduction 

For the past decade, scientists, policy makers, and resource 

managers have debated the likelihood of a significant global 

warming and the likelihood of meaningful climatic changes 

induced by global wanning. Despite some notable critics, 

much of the scientific community agrees that accelerated 

atmospheric warming-an enhanced greenhouse effect-is 

occurring or will occur primarily due to the rapid atmospheric 

accumulation of carbon dioxide (CO,) and other trace gases 

fi-om the burning of fossil and biomass fuels @lake and 

Roland 1988; MacDonald 1988; Rarnanathan 1988; Smith 

and Tlrpak 1989). This accumulation may absorb 

signrficantly more long-wave radiation than in the past, 

thereby warming the earth and raising the mean global 

temperature @owd 1986; Houghton and Woodwell 1 989). 

Because weather and climate are partly influenced by the 

long-wave radiation given off by the earth, important climatic 

changes are possible (Henderson-Seller and McGuffie 1 987). 

The correlation between temperature changes and 

atmospheric CO, concentration concerns many scientists. 

Barnola and others (1 987) quantrfy the correlation between 

atmospheric CO, and changes in global mean temperature 

through ice core analysis. Machta (1 983) documents the rise 

in CO, concentration in the amosphere. Because correlation 

and rising CO, concentrations do not prove global warming, 

scientists continue to refine the theory and describe 

mechanisms other than atmospheric GO, concentration that 

influence mean global temperatures. 

Although much uncertainty exists about the mechanisms that 

could enhance or negate global weg, the best information 

Graduate Research Assistant and Associate Professor (respedively), 

Mississippi State University, Starkville, MS and Freeport-McMoran 

Professor, Tulane University Medical Center, New Orleans, LA 

to date suggests that the earth's mean global temperature 

could rise by 1.5 to 5.1 "C within the next 50 to 100 years 

(Smith and Tirpak 1989). Such rapid changes in temperature 

accompanied by changes in precipitation patterns would 

affect a wide range of ecosystems, including forests (13azzaz 

1 990; DeLaune and others 1 987; Smith and Tirpak 1 989). 

The ability to grow crops would change depending on mean 

temperatures and precipitation amounts and timing. The same 

factors would affect forest distribution. In North America, 

forests would likely migrate northward or to higher elevations 

over time. Climatic changes might occur more rapidly than 

forests' ability to migrate. Stress-induced mortality in the 

southern range extremes would likely out-pace northward 

migration. 

While this could ~ig~cantly affect the southern forest 

industry and the economy of the Southern U. S., few 

researchers have attempted to investigate the economic 

implications of climate change on resource-based sectors or 

on regional economics, primarily because the information 

needed to conduct such analyses is lacking (Cubbage and 

others 1 992; Regens and others 1 989). This study will 

provide the initial comprehensive review of the data 

requirements, availability, and uncertainty for evaluating the 

economic impacts of climate change. Specifically, the 

primary purposes of the study are to identlfy the biophysical 

data required for assessing the economic effects of global 

climate change on timber production in the South and to 

assess the availability of those data Such insights will aid 

future socio-economic studies of climate change. The four 

objectives of the study follow: 

1. Identlfy the biophysical information needed to evaluate the 

socioeconomic impacts of climate change on forestry in the 

South; 

2. Inventory sources of currently available data on flrture 

climate scenarios, forest response, and potential impacts on 

forest management operations; 

3. Appraise the uncertainties in the available data and the 

impact of the uncertainty on economic projections; and 

4. Identdy gaps in the required data. 
Literature Review Global Economic Theory and the Enhanced 

Greenhouse Effect 

The greenhouse effect results fkom the emission of 

greenfiouse gases during production and consumption of 

ices. Using the current know1 

that essiuns impose, society has dete&ed 

hage levels and the 

provided. Because of 

inflict in the future, society is reevalwting the social cost of 

gas &ssions, redet-g ac~eptable damage 

levels, and reex-g the optimal quantity of social welfare 

to be provided. 

de Steiguer (1 992) describes how society determines the 

optimal quantity of social welfare to be provided and how 

society adjusts this quantity as needs change. The marginal 

cost that society is willing to pay for emissions must equal the 

marginal benefit society receives from the emissions (fig. 1 a). 

At equilibrium, society has deteded that at price p, q units 

of bssiuns tlre provided. Consumers receive a surplus 

equal to the area in the triangle marked consumer surplus, 

while producers receive a surplus equal to the area in the 

triangle marked producer surplus. The sum of consumer and 

producer surpluses represents a measure of the social welfare 

associated with the emissions level. Social weKare is a 

measure of monies consumers and producers have available 

to invest or spend on goods and services. 

Problems occur when the marginal cost (MC) of emissions 

increase, as shown by a leftward shift of the XXC curve to MC' 

in figure 1 b. Now the quantity of social welfare provided 

decreases, as indicated by the changes in consumer and 

producer surpluses. Both consumers and producers s&er a 

decrease in surplus, indicating both consumers and producers 

have less money to spend. Society may decide this situation is 

unacceptable and act to increase the level of social welfare 

provided or decrease the burden on afEected groups. 

hcreasing the level of social welfare to a desirable level 

typically involves privatking part of the cost associated with 

emissions previously socialized (see fig. 2). This may result 

in higher prices for some and services until hovation 

ends unacceptable emissi s action forces the marginal 

cost curve of emissions to the right, towards the original 

in figure 2. Dete-g the 

gas emissions to society is a 

critical step in deteg the acceptable level of damage 

from greenhouse gas emissions. 

Maler (1 992) describes the externality of greenhouse gas 

emissions as an overuse of a globally wmon resource. 

Overuse is the result of a Nash equilibrim.' Each country 

m-es its net national welfare by allowing the 

atmospheric emission of greenhouse gases until the national 

net weKare gained from the emission of an additional ton of 

greenhouse gases is zero (marg;lal costs equals marginal 

benefits). The sum of the emissions from each country is 

greater than the Pareto eflFicient use of the atmosphere for 

 emission^.^ Because unilateral actions to limit greenhouse 

gas emissions by a country could result in a short-term 

economic disadvantage for that country, unilateral actions 

should not be expected. 

To achieve a Pareto efficient use of the atmosphere, countries 

should emit greenhouse gases only to the point at which 

emitting an additional ton of gases would reduce net global 

welfare. Determining the globally desirable concentration of 

geenhou gas hssions (the level at which the margirnal. 

benefit to global welfare equals the marginal cost to global 

welfare) requires intmational cooperation and accurate 

regional infomation gUraler 1 992). 

To identlfy the globally acceptable level of damage from 

greenhouse gas emissions, specific regional damage caused 

by emissions must be determined (Cline 1 992; Yohe 1 99 1). 

Possible adaptive strategies must be identified for each region 

and incorporated into global policy decisions (Cline 1 992). 

Because of the uncertainty associated with the impacts of 

greenhouse gas emissions, Cline (1 992) suggests that ranges 

of damage need to be developed for specific periods in the 

he. Other investigators agree that regional estimates of 

darnage are necessary. 

"metson and Nordhaus (1989) a Nash equilibirum as a situation 

in which all parties "lose" but parti iolate the stable condition "lose 

big" while not violate the stable condition "gain big." Eall 

parties coo 11 parties could gain, but violation of a coopetative 

~ee~ent multf in big gains for the violator and big losses for the others. 

There is incentive to violate cooperative agreements. 

' Smuelson and Nordhaus (1989) defrne Pareto as an outcome in which no 

reorgeon could mur that would raise the satisfadion of one individuaI 

without lowering the satisfaction of another. 
q' q 

QUANTITY OF EMISSIONS 

MB = marginal benefit 

MC = initial marginal cost 

MC ' = increased marginal cost curve 

p = initial price 

p' = price after an increase in marginal cost 

q = initial quantity of social welfare provided 

q' = quantity of social welfare provided after 

an increase in marginal cost. 

Figure 1-a) An illustration of consumer and producer surpluses and the equilibrium price and quantity of emissions. (b) The 

effect an increase in marginal cost has on consumer and producer surpluses and the equilibrium price and quantity of emissions. 
MC private + social 

Quantity of Goods 

q = quantity of goods consumed 

q' = quantity of goods consumed after social cost privatized 

p = price of goods consumed 

p' = price of goods consumed after social cost privatized 

Demand = demand for goods 

MC private = private marginal cost associated with 

the productioll of goods 

MC private + social = the private marginal cost + the social 

cost of externalitites associated 

with goods 

Figure 2-An illustration of the impact that privatizing the cost associated with externalities 

has on the market price of goods and the quantity of goods consumed. 

Regional Economic Theory and the 

Greenhouse Effect 

The literature reveals the need to link the global 

enviromental and economic consequences of greenhouse gas 

emissions to regions. This linkage is necessary because 

althou* greenhouse gases are emitted by many countries, the 

enviromental and economic consequences associated with 

these emissions may be different for every country and region. 

First, the enviromental damage and the associated economic 

cost of greenhouse gas emissions must be determined 

regionally. A globally acceptable level of enviromental 

damage and economic cost must be determined fi-om this 

regional infamation (Maler 1992). Next, likely regional 

adaptive strategies must be identified and considered in global 

policies to abate greenhouse gas emissions (Cline 1992). 

Finally, the marginal benefits and marginal costs of 

greenhouse gas emissions abatement must be considered for 

each region. To achieve a Pareto eflicient use of the 

abosphere for greenhouse gas emissions, the global marginal 

cost of abatement must equal the global marginal benefit 

waler 1992). Figure 3 illustrates Maler's central idea. The 

marginal costs and benefits realized fi-om emissions 

abatement are not likely to be evenly distributed throu&out 

every region of the world. Global negotiations will be 

necessary to ensure that countries that have high marginal 

costs of abatement but low marginal benefits fi-om abatement 

have suffcient incentive to comply with the greenhouse gas 

enlissions levels determined to be optimal (Maler 1992). 
No Abatement Complete Abatement 

GLOBAL QUANTITY OF ABATEMENT 

QNash = Nash equilibrium emissions level 

Q Pareto = Pareto efficient emissions level 

Figure 3-An illustration of the supply and demand for greenhouse gas emissions abatement as the global market 

moves &om a Nash equilibrium emissions level to a Pareto eficient use of the atmosphere for emissions. 
Methods 

Data Requirement Identification 

The first, and most crucial, phase of the study is to identrfy the 

data needed to evaluate the mnonnic impacts of climate 

change on forestry in the Southm U.S. An analytical 

framework similar to that described by Wodges and others 

(1 992), illustrated in figure 4, was used and emphasized the 

potential impacts of climate change to forest management and 

tirnber production through the first phase of processing. The 

emphasis on timber production reflects its importance to the 

southern economy. Forest products constitute the first or 

second most important manufachg sector in most of the 

Southern States (USDA Forest Service 1988). As a 

consequence, any change in the outlook for timber 

management and production will be of great interest to the 

forestry sector and policy makers in the South. 

The framework identifies the economic impacts of greenhouse 

gas emissions through the secondary impacts suffered by the 

forest industry. The primary biological data needs are 

gouped into three components. These include those listed in 

"Direct Impacts of Air Quality on Forest Productivity," 

"Impacts on Forest Productivity," and "Changes in Wood 

Properties." The impacts of air quality on forests involve the 

tradeoff between damage ii-om pollution associated with 

greenhouse gases and the potential fertilization effects of an 

enriched CO, atmosphere. Several researchers have noted the 

possibility of increased productivity as a result of an enhanced 

CO, enviroment. Specifically, seedlings of several tree 

species increased height and diameter growth when exposed 

to increased CO, levels (Funsch and others 1970; Pastor and 

Post 1988; Rogers and others 1 983). More recent studies 

suggest that tree response could vary ~i~cantly by species 

and age. Bazzaz and others (1 990) found that while several 

nodeastern tree species responded positively to increased 

CO, levels, shade tolerant trees exhibited a greater response. 

Clearly, better information on the direct impact of air quality 

on tree physiology is required. 

Climatic change could cause some southemi tree species to 

rnigrate no&ward or become locally extinct. Southern pines 

will be e1iminate-d or greatly reduced in Georgia, Mssissippi, 

and North Carolina if projected climatic changes occur (Joyce 

and others 1 990). The range of loblolly pine is projected to 

increase to the North, however, the overall site index will 

deerease as the forests shift to poorer sites (Mtller and others 

1987; an and Furiness 1 989). Accurate infomation 

about future forest distribution and site quality is required. 

Climatic change could influence the incidence of wildfiie and 

pest outbreaks. Fire could increase substantially in regions 

where dfoughtf or longer dry mas are projected (Shard 

and Main 1987). S~larly, insect outbreaks and disease 

epidemics could increase simcantly, aIthough speciflic 

magnitudes are unknow. It is likely that major forest pests 

will adapt to climatic changes sooner than tree species 

wedden 1 987). 

Finally, wood formation and quality are likely to be afEected 

by climatic change. With longer, drier summers, the amount 

of latewood produced would decline while more low density 

earlywood would be produced during the wetter spring 

months. Thus, the specific gravity of wood would decline 

resulting in a reduction in the strength of lumber and paper 

products. 

Based on the framework presented above, key data needs 

were identified: 

1. Ranges of comacially important tree species are 

required; 

2. Changes in site quality are required; 

3. The net effect of air quality, climatic change, and pest and 

wildfire incidence on forest productivity are required; and 

4. Changes in wood quality are needed. 

At the present time, these data needs reflect some of the basic 

uncertainties associated with climatic change. 

Available Data Inventory 

The second phase of the study entails inventoqing all 

available sources of the required biophysical data. Because of 

the effort already expended assessing General Circulation 

Models (Cooter and others 1 993), we fwused our aEention on 

models designed to simulate forest respons to climatic 

change and on other data needs. 

Forest response models are designed to process climatic and 

biological data to project the hture structure and distribution 

of forests and species composition. Solomon and West 

(1 987) discuss the desirable characteristics of forest response 

models: 
GLOBAL EMMISSIONS OF CARBON DIOXIDE & TRACE GASES 

REGIONAL CLIMATE CHANGE 

- Change Precipitation 

patterns 

- Changes in Temperature 

Variation 

- Changes in Growing Season 

Length 

QUALITY ON FORESTS 

- Carbon Dioxide 

IMPACTS ON FOREST PRODUCTIVITY 

- Changes in Major Commercial Species 

- Changes in Site Quality 

- Changes in Forest Productivity 

- Changes in Severity of Damage 

from Fire, Insects, And Diseases 

1 

CHANGES IN WOOD i I CHANGES IN TOTAL ACRES IN RANGE 

PROPERTIES 

- Tree Form 

- Quantity of Latewood 

- Specific Gravity 

X 

CHANGES IN YIELDS PER ACRE 

- 

NET CHANGE IN TOTAL 

INVENTORY & HARVEST (per year) 

- Net Yield Change x Price 

- 

- Capacity Effects 

- Market Preferences 

STUMPAGE VALUATION OF 

PHYSICAL CHANGES 

- Net Yield Change x Price 

- Constant Dollars 

- With Real Price Increases 

ESTIMATION AND EVALUATION OF EFFECTS ON INDUSTRY SECTOR 

- Forest Management Practices 

- Mill Reductions, Closings 

- Mill Movements - Physical Problems 

Figctre 4-A fiamewofSc to investigab the regional socio-economic hpads of grehouse gas emissions on the forest-dependat economy of the Southern U.S. 
1. Models must predict forest responses to climatic change at 

the tract level 

2. Models must reflect the eomplex ofthe forest ecosystem 

a. Multiple species must be considered 

b. Multiple developmental stages must be modeled 

c. Forest responses to competition must be modeled 

d. Other envkomentally limiting factors must be 

modeled 

Computer models that simulate interactions among several 

species by silvical characteristics and limited by 

environmental stress offer the most valid approach to date. 

The forest response models that have been used to project the 

biological impacts of climate change can be broadly classified 

as physiologically based models or com~ty-based models. 

Physiologically based models we designed to predict the 

response of individual plants to changes in the envkoment. 

These models do not consider competition between plants or 

possible changes in nutrient cycling (Joyce and others 1990). 

Com~q-based models predict future forest species 

composition on a large scale. Such models, however, do not 

consider the timing of reforestation or the factors that will 

affect reforestation in the future. Descriptions of both types of 

forest response models follow. 

Forest of Eastern North America (FOENA) is a gapdpamic model developed &om Forest of East Tennessee 

(I;ORET) and Janak, Bokin, Wallis (JAIEIOWA). FOWNA 

' grows' forests in annual time steps with 115 acre gaps 

occdg with the death of mature trees. FOWNA has, to 

some degee, all of lhe characteristics previously listed. 

FOWNA predicts forest response to enviromental change 

sic envkommtally IGting factors to affect 

the intrinsic processes of birth, death, and growth. These 

in~sic processes are controlled by species specific 

constants, The environmentally l~ting faetors explicitly 

modeled include growing degree days (CDD), &ought days 

@D), and winter kill. The eEects of CO, fertilization, 

changes in nutrient cycling, changes in water-use eficiency, 

possible changes in the m temperature at which 

photosynthesis ciun occur, gow-th beneiits that may occur for 

a longer nowing season, and possible changes in fire, insect, 

and disease damage are m and not modeled. 

Temperawe is an essential input that general circulation 

models (GCMs) can provide. GDD and winter lull are 

calculatd &om daily temperame. FOEMA rmdody selects 

daily temperames wi~ variance sound 

the input means. Genmal 

mean taperawes. Vari 

historical or thwretical sources. 

Maximum and Wm GDD are determined for each tree 

species from the southern and northern range extremes, 

respectively. Temperatures above 5.5 "C add to GDD's. Tree 

growth is adjusted for each species by GDD's. If GDD's 

exceeds the m&m or aum optimal GDDts 

detebd for each tree species, growth reduction occurs. 

For each species, maximum growth is a parameter from 

which only reductions in growth are possible. Longer growing 

seasons would result in less growth in the southern extremes. 

The range in which optimal gro~ would occur would shift 

north. 

MonMy mean precipitation is another essential input which 

GCM's can provide. F0IS;ENA determines mcmnwy 

precipitation by randomly selecting a value from a 

predetermined variance about the input mean. Again, GCMs 

do not provide variance data. Historical or theoretical sources 

must be used. 

Drought tolerance is calculated by detemining the minimum 

amount of rainfall each species must have during the growing 

season. The western range extreme for each species provides 

this idomation. mum precipitation is divided by the 

length of the growing season to provide a constant for each 

tree species. This constant is multiplied by the length of the 

growkg season for the modeled site to provide the drought 

tolerance parameter DD's for each species on the site. Tree 

growth slows as DD's increase from zero to the species 

ma~m. Beyond ma*um DD's, growth is zero. 

Changes from ophal conditions in GDD's and DD's 

adversely aflkct species &rod. In FOWNA, slow god is 

defmed as one-tenth ofthe empirically measwed rn 

possible groh for a species. The event of slow growth 

increases the possibility of tree death. Two independent death 

processes detede tree survival. Senescence decreases 

radial growth, decreases crodstem ratio, increases root 

mortaliq, decreases root regeneration capac~ty, and decreases 

tree resistan= to pathogens. To account for the effects of 

senescenw, FOENiZ logn cally increases the probabiliw 

of tree death with age. 
Additional enviromental factors also influence the 

probability of death, such as late frost, too much or too Iittle 

water, fire and lighting damage, too little sunlight, insect 

defoliation, and nu~ent deficiencies. FORENA increases the 

probability of death after two wnsecutive years of slow 

growth. Drought tolerance, shade, stand density, winter kill, 

and gowing season length account for some of these 

enviromental factors. 

Maestro is a physiologically birsed forest response model. The 

model measures the response of established forest trees to 

changing climatic conditions. Maestro does not allow for 

forest tree replacement and cannot be used to determine hture 

forest composition. Maestro has several desirable properties. 

The effects of possible CO, fertilization and changes in wateruse eEiciency can be considered. Maestro also considers 

photosynthetic reactions to temperature changes. The input of 

specrfic site and soil parameters would allow Maestro to 

make regional predictions based on these parameters. Finally, 

because Maestro measures changes in net photosynthesis, 

crude estimates of insect and disease response to changes in 

forest vigor may be possible by tree species and site. 

Maestro has several drawbacks. The model only permits 

estimating the response of coniferous monocultures. Sitka 

spruce and radiata pine are used to validate the model; data 

needed to model southern pines must be collected. Maestro 

requires the X, Y, and Z coordinates of every tree in the 

modeled forest, Also required are parameters that describe 

leaf inclination angle and distribution throughout the tree 

crown by leafage, as well as the total area of leaves within a 

tree crown. Maestro does, however, have subroutines within 

the model that will calculate leaf spatial distribution and 

klination angles if none are provided. Other required leaf 

parameters include the transmittance and reflectance of 

photosynthetic radiation (PAR), near infrared radiation (NIR), 

and thermal radiation. Maestro is very data intensive. 

The inputs Maestro would require fiorn CCM's are sunshe 

duration, cloudiness, wind speed, air temperahue, water 

vapor saturation deficit, and hourly flux densities of PAR, 

, and thermal radiation on ho~ontal surfaces and their 

corresponding beam &actions. Some required soil parameters 

include temperature and the reflectance ofPAR, NIR, and 

thermal radiation. GCM's may not provide radiation 

dormation as an hourly output, but they do intemalIy predict 

this orm mat ion. 

Evaluating Available bformation 

Evaluating the available oma at ion will involve identifLing 

gaps in the data requirements and evaluating the utility of the 

available data. Identrfling data gaps will be relatively 

straigh~omard. Any data requirement characterized in phase 

two where infomation is unavailable will be identified as a 

data gap. For these, attempts will be made to identlfy any 

research underway to provide these data and expected date of 

completion. An effort will also be made to identlfy any 

related information that could be used to fulfill the data 

requirements. 

The most crucial aspect of this phase will consist of 

evaluating the utility of the existing data for assessing the 

economic impacts of climate changes. The primary problem 

will be to evaluate the importance of the data for economic 

evaluation, the range of available predictions, and the most 

reliable estimates. The principal objective of hs phase is to 

describe the range of currently available projections and 

where possible, evaluate how the economic impacts would be 

&ected by the range of projections. Four broad classes of 

data will be examined: 

1. Changes in the ranges of commercial timber species 

2. Changes in site quality 

3. Changes in forest productivity due to carbon dioxide 

fertilization 

4. Changes in wood formation and quality 

The uncertainty or low credibility of the estimates derived 

from limited biophysical information is the primary factor 

limiting the decision relevance of such assessments. First, 

uncertain@ stems &om major gaps in the Somation about 

mderlying dose-response relationships over variable time 

ho~ons. Second, because preferences are for environmental 

not directly observable in mmkeb, there are always 

questions regarding the estimated monetary value of the 

benefits. Third, even when those preferences are 

monetarized, aggregating them to derive social preferences 

can be problematic. As a result, doubt about the confidence 

that can be attached to estimates, even when preferences are 

well defined, is a general constraint to using this type of 

analysis in the decision-making process. 
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A Value-Based, Multi-Scalar 

Approach to Forest Management 

R. Gordon Dailey, Jr., and Bryan G. Norton 

Abstract 

In this paper, a value-based, multi-scalar approach to forest management is 

proposed as a means to incorporate public concerns expressed for different 

time horizons into the management of public forest land. Under such an 

approach, public values-including both economic and environmental 

concerns-are assessed at the local level and provide the basis for manag;lg 

public forests on multiple scales using the principles of hierarchy theory. 

This approach assesses intergenerational concerns that may be expressed on 

diffierent, incomensur&le scales and then develops appropriate hierarchical 

models of the ecological relationships that relate to those values. Using a 

multi-scalar approach, resource managers can select forest mmagmerrl 

practices at different scales to refled these multiple public values. By 

mana&g the forest at dinrerent scales within limits derived &om the values of 

citizens, tradeoffs behveen competing uses of the forest may be minimized. 

Introduction: Challenges for 

Forest Managers 

Forest management practices have often been criticized for 

inadequate consideration of the public's environmental 

concerns in the pursuit of economic resource use. With issues 

ranging from the preservation of endangered species, such as 

the red-cockaded woodpecker, to the siltation and pollution of 

rivers and lakes, forest managers face several new and 

dficult challenges for managing public resources in the 

hture. New tools and techniques will be needed to meet the 

multiple and apparently conflicting demands for the forest 

resource while facing these challenges. 

In p&icular, as the accumulated effects of localized 

mmagement practices are manrfested on increasingly lasg.er 

scales, &ere is a need for a new approach to forest 

mmagement &at can accomt for bo& the multiple wlues and 

concerns of the public, as well as the potenlially large-scale 

kgacls frm forest mmagement practices. 

In "Thmking Like a Momtam," AIdo Leopold (1 949) 

descr-ibes the short-sightedness of wolf eradication as a 

resource management practice. From the hption of deer 

md devastation of the mountainside that followed the 

extirpation of th~s predator, he saw how the wolf was part of a 

complex htenelationship that unfolded on the mountain's 

time frame, not man's. Such large-scale and longer-term 

impacts from resource management continue to be an issue 

for land managers. Increasing calls for "whole ecosystem 

mmagement," such as in the Greater Yellowstone area, are 

clear expressions of the need to consider these large-scale 

dynamics in resource management to maintain the fiurctioning 

of ecological systems that support many drfferent features of 

the natural enviroment (Norton 1 99 1 ). 

Coordination of forest management activities with other 

resource management efforts is becoming increasingly 

important. Forestry practices, such as clearcutting, can 

sigdicantly impact aquatic systems. A system that can 

identlfl and account for these indirect effects and larger-scale 

considerations in local-level forest management will be 

needed to ensure the success of these other programs. Noss 

and Hamis (1 986) note that wildlife preservation strategies 

have typically been static and limited in scope. These 

strategies have generally focused on individual species, while 

the factors that affect those species and their habitat are part 

of larger-scale ecological dpamics. They suggest that the 

emphasis on endangered species and the assuption of an 

ecological "equilib~m" system is insufficient for the 

maintenance of species diversity over the long tern?. The 

problem with narrowly focused static approaches is that they 

fail to recome that individual plmt or 

and even whole ecosystems are part of larger dp&c 

processes that represent the conte~ within wGch they 

hction (Costma and others 1992; Leopold 1 949; Norton 

1992; Noss d H~s 1986). These dynamiic patterns, 

boweva, exist on many scales, each providkg a slower 

chmmg mte* ibr the faster changing processes on smaller 

scales. To eEectively manage for multiple and indirectly 

related public objectives, such as water quality and wildlife 

presenation, forest and other resource managers must 

recowe these larger-level processes and incorporate them 

g and mmagement efforts. 

Graduate Research Assistaart and Professor (respedively), Georgia lnstibte 

of Technology, Atlmta, GA 
Another problem for forest managers is that many ofthe 

hpacb on publicly valued resources may result fi-om 

activities that take place on both public and private land. For 

exmple, erosion withm a watershed and its hpact on public 

water resources is not limited by property lines. In the South 

where a si&~cmt portion of the forest land is privately held, 

consideration of private land management activities is 

particularly important. Public land management must be 

coordinated with the management of private land, or public 

forest managers must be able to mitigate the eficts of private 

activities on public resources. Ecological models that 

chmterize these relationships and a managem system 

that can incorporate these considerations are needed to both 

preseme and use public resources into the fbture. 

Forest managers will also require a management and pl&g 

process that can address the effects on forests from exogenous 

factors, such as acid rain, air pollutants, and global climate 

change. Ecological models that can indicate how groundlevel ozone sects the growth rates and composition of the 

forest would be one example. Alternatively, large-scale 

concerns, such as global climate change, may mean that forest 

managers will be called upon to proactively manage the forest 

as a carbon-sink in addition to managing for the demands of 

the timber industry and recreationists. 

Perhaps most important is the need to recognize that public 

values may themselves exist on different scales. The problem 

is that when timber harvesting jobs and wildlife preservation 

are compared in terms of the present, they seem to represent 

competing value positions (Norton in press). However, they 

do not necessarily require a one-or-the-other trade-off. The 

point often overlooked is that both of these forest "uses" 

require the continued hctio~g of larger, "landscape-level" 

ecological systems if they are to be sustained into the future. 

Neither economic productiviy nor aesthetic and 

ins~entally valued natural features can be protected 

without protecting the complex, orgeed system that 

provides the ecological context on whch all these values 

depend (Norton 199 1). A system that can manage public 

resources such as forests at these various scales is necessq 

e trade-offs and maintain the ecological integrity of 

natural systems that support publicly valued uses and feahises 

of those resources. 

The Concept: Multi-Scalar Management 

To rneet these challenges and to help avoid politically 

dete~ed restrictions on economic resource use, we 

propose a scalar system of resowe management. The idea is 

to develop a scientifically infomed, public value-based 

constraint system on economic resource management. A twostage model for such a management system has been 

suggested by Norton (1 992) (fig. 1) . Potential impacts &om 

different management practices are located in ttus "risk 

decision space" by the degree of reversibiliv of the impact 

fiorizontal axis) and the scale of the impact (vertical axis). 

Activities whose impacts fall in the large lower-right area are 

s~ciently addressed by traditional economic approaches. 

The multi-scalar approach, however, supplements traditional 

economic methods of resource management by placing 

constraints on practices that have large-scale and potentially 

irreversible impacts. These would be management activities 

with impacts falling in the upper left-hand corner of figure I. 

Time of Reversibility 

Irreversible Reversible 

Figure l-Risk-decision square for locating management impacts. 

However, restrictions are not necessarily placed on activities 

with any large-scale or irreversible impact. In our approach, 

public values are used to defm the type and scale of impacts 

that fall into the upper corner, public values defme where the 

demarcation line falls. 
Hierarchy Theory 

s that suggest that evolutionarq. processes 

favor nested, hrerarcfucal organization (Simon 19621, 

hierarchy theory has been applied to the functioning and 

relationships of ecological Vterns (Allen and Starr 1982; 

O'Neill and others 1986). It represents one way to 

characterize complex ecological phenomena that are 

interrelated but may occur at different scales. In a 

hierarchical structure, my given "system" operates as both a 

part of a larger system and, at the sme time, as an 

independent "whole" in itself. As a "whole," a system exerts 

some constraint on its component "subsystems" that are 

aemselves both wholes and parts. As a "put," that sme 

system operates as an integrated component of a larger whole 

(Allen and Starr 1982). Through th~s type of structure, the 

stability of ecological systems is maintained. 

Ths stability results from its constraint system. It is, 

however, a dpec stability. The self-assefiiveness of a 

constraining enviromental system within its larger 

"enviroment" essentially protects the smaller-scale 

"subsystem'%at it controls (Allen and Starr 1 982). 

Disturbmes can be 'kcorporated by a system when it 

exerts control over a factor that is not controlled at lower 

levels of organization (O'Neill and others 1986). For 

example, the forest as a whole minimizes local temperature 

variations through evapokanspiration, while individual trees 

cannot (O'Neill and others 1986). Under certain conditions, 

however, this constraint system can be broken with effects 

that propagate up the hierarchy (Johnson 1993). Leopold's 

(1 939) examples of the effects of predator eradication and the 

problems of early German monoculture forestry illustrate 

these iypes of larger-scale effects that result from changes in 

local-level activities. 

For forest management in the fume, hierarchy theory 

provides a conceptual basis for incorporating economic 

resowe management at the local lewI tfiltlhiPl the need to 

maintain regenerative qsterns at larger scales. Tn a scalar 

qsten? of management, local activities can be conskained by 

a hierarchy of longer-term, lu@er-le~l emsiderations. That 

is, in a herar~hical stTuclure, management at the toea1 level 

may vary considerably according to local deskes as long as 

they do not intedere with objectives established for 

management at larger scales and over longer time frmes. 

In our approach, the goals for resource management at each 

scale are defmed by ecologrcal dmecs at those scales 

associated with the maintenance of publicly valued namal 

features and resource wes. Basically, management at any 

pMieulx scale fwuses on sust g valued nahual rescturces 

or fea~es ~ough time by ens~g, via scalar constfaints, 

that management activities and exogenous impacts remain 

wib the bounds of higher-level ecological dyxamics 

operating in longer time frames. By recowing ecological 

constraints, multi-scalar forest management can help to avoid 

the lager-scale impacts that result from exceeding a critical 

threshold at a lower level. 

Hierarchy theory also provides a usehl conceptual framework 

for modeling ecologcal systems to address scale-related 

resource management issues (Johnson 1993). Tfus is 

important because the descriptive scientlfic models 

traditionally used to characterize various ecological systems 

may not be saicient for resource management in the future. 

Since no single or "fundamental" hierarchical description of 

nature exists (Allen and Starr 1982; Johnson 1993; O'Neill 

and others 1986), there is no single model that could be used 

to evaluate the many ecological impacts of diEerent forest 

management strategies. Because a particular system may be 

described in several ways, it has been suggested that an 

appropriate hierarckrcal description should be based on the 

phenomena we are interested in observing (O'Neill and others 

1986). Since certain characteristic properties "emerge" 

depending on the scale of obsenration (Allen and Starr 1982) 

and since ecological systems can be described in several 

different ways depending on what we are interested in 

observing, the development of models for ecological resource 

rnanagement is necessarily a prescriptive science @askell and 

others 1992). This is particularly hportmt for issues of scale 

in resource management. The correct scale on wkrch to 

address a management problem is dete-ed by what society 

wants to accomplish with that system (Norton 1992). That is, 

an ecological system can and should be modeled differently 

depending on what forest services we are interested in 

Thus, in our approach, public values are used not only to 

define resource management at different scales, but they are 

also used to define the ecological models ofthe ystems to be 

mmaged. This is importmt because appropriate management 

objectives cmot be connpletely de 

scientif~c understanding ofthe relationships that affect 

s and resource uses. As a 

ogical qstems, hieraseby 

theory helps scientists, forest managers, and the public 

ident@ relevant ecological dmics and variables operating 

at each scale. Through an iterative and ongoing process of 

kteraction with the public and forest manaFrs, scientlfic 

study caa be wid& towards developing herarclcal models 

that inform public understmding of eeo~stem hctioning in 

a way that helps to defm resource rnmagement to achieve 

public goals wrton 1992). 
The Advantages of a Multi-Scalar Approach 

A multi-scalar approach to forest management has many 

advantages. This approach can incorporate mdtiple public 

values into a multi-scaled management strategy and also 

provide a frmework through vvhich ecological models can be 

developed to identlfl appropriate constrainls for resource 

management at various scales. hportantly, our approach is 

designed in such a way that forests can continue to be 

managed for econo~c use at one level within constraints 

hposed by ecological considerations at higher levels so that 

trade-oEs bemen seehgly conflicting values can be 

mininzized. 

With its focus on management at different scales, this 

approach also provides a system through which to account for 

many of the factors which complicate contemporary forest 

management. Because it recognizes the importance of 

regenerative landscape-level processes in mainta&g all 

publicly valued natural "goods," scalar management can help 

to avoid large-scale or irreversible impacts and minimize 

trade-offs. Through its emphasis on multi-scaled public 

values, this approach provides guidance to forest managers in 

response to the impacts of exogenous factors. For example, 

air pollution has been documented to have several different 

impacts on forests leading to decline WacKenzie and ElAshry 1989). Forest managers could adjust their management 

practices in order to mitigate impacts on timber production or 

mitigate further impacts on aquatic systems by minimizing 

their contribution. Either way, ecological models that 

characterize the relevant variables and dynamics can help 

forest managers determine how their activities influence 

publicly valued resources and identlfl appropriate strategies. 

A multi-scalar approach can also help to coordinate forest 

management with other efforts to maintain publicly valued 

enviromental resources. Although mainta&g the viability 

of fish populations has not generally been the responsibiliq of 

forest managers, the management practices on public forest 

lands nonetheless affect river and lake systems ~ou& soil 

erosion and nuhent moB (Morris and others 1992; Salverda 

1968). Given a publicly expressed concern for the health of 

rivers and lakes, our approach requires the fornulation of a 

hierwchical mode1 of ecological relationships appropriate for 

considering these impacts in forest managemmt. In a similar 

fashion, forest managment could also serve as a means to 

proactively address global wdg by increasing net p~ary 

productivity to enhance the role of the forest as a C02 sink 

Wo~s aadothers 1992). Models that can characte~e the 

impact on the atmosphere and the ecological relationships 

associated with carbon fixation would facilitate such 

activities. 

Applying Multi-scalar Public Values 

to Forest Management 

Once we have accepted the role of public values in def~g 

not only the management but also the ecological science upon 

which it relies, the problem of developing a value-based 

management strategy becomes one of translating these values 

into management objectives at different scales. To do this, we 

must associate dzerent values with ecological systems at 

appropriate scales as noted above. Before this can be done, 

however, several questions must be answered. These 

questions include whose values are to be counted, how are 

they to be assessed, how can they be translated into 

management objectives, and how are the values of different 

com~ties to be integrated. 

C4Bottom-Upn Valuation 

Willcinson and Anderson (1 987) note that in the past, public 

forest management and planning was a decentralized activity 

where local managers used their knowledge of the specific 

Aaractef-istics of the local forests they managed to both 

protect and use the resource. In the 1920's timber 

management plans determined the amount of timber that 

could be harvested from "working circles," which were areas 

large enough to support local forest-based industries. These 

efforts included an explicit concern for protection of the local 

watershed, and recreation was increasingly considered in the 

plans. However, as private timber lands were cleared in the 

post-war building boom of the 1 9507s, this relatively 

uncontroversial planning framework began to break down as 

increasing demands were placed on the national forests for all 

their resources. The result of the controversy over multipleuse forest management was legslation that established 

national planning along with a range of legal standards for 

local forest planning and management. The need for Federal 

action arose &om both timber industry demands as well as 

increasing public demands for the preservation of existing 

wilderness areas. 

This change, in effect, imposed national-level values on loeallevel forest management. Wilkinson and Anderson (1 987) 

note that the unit pleg framework that replaced multipleuse plans in the early 1970's was intended to ensure greater 

consistency between national and local land use priorities. IIi 

this new framework, "Area Guides" advised forest planners of 

an area's relative ability to achieve national objectives for 

various resources wilkinson and Anderson 1 987). Ln 

essence, local resources were no longer being managed to 

meet locally defmed needs as expressed by local values. 
To see how th~s may affect ecological systems, it is important 

to look at how cullhtral instibtions define the relationshp 

behiieen man and his enviroment. In his ecological history 

of New England, William Cronon (1 983) illustrates how 

dserent social institutions led to dzerent interactions 

between hums and the envifoment that shape the 

lmdscape in different ways. The role of values, including 

cultural beliefs, is an important part of this. Most importantly., 

the notion of resources as comodities and monetary wealth 

as an indicator of status weigh into Cronon's description. The 

latter concept in pasticular has a signuficant impact on 

resource use. 

European markets . . . at least in theory "erected a shrine to 

the Unattainable: Mite Needs." Those needs were 

deterrnined not only by the local eommities that became 

established in colonial New England but by all distant places 

ties sold their goods. The landscape 

of New England thus increasingly met not only the needs of 

its inhabitants for food and shelter but the demands of far 

away places' markets for cattle, corn, fix, timber, and other 

goods whose "values" became expressions of the colonists' 

socially deteded needs. (Cronon 1983 : p. 166) A similar 

phenomenon occurred in the southern forests as the region 

sought to finance industrial development and thus, increase 

their wealth through the exploitation of its forests (Willias 

1989). 

Wile both the Native hericans and the colonists shaped the 

land to meet their ow purposes, they did so in fundmentally 

drfferent ways. The colonists, with their experiences of timber 

as a scarce resource in England, saw the forests as an 

abundant resource to be exploited. With no prior experience 

within the landscape of the New World, they did not see 

forests as an integral part of their lives. In contrast to the 

colonists, however, the Native Americans had a much closer 

mderstanding of the land through a longer historical 

association with it, and ihey were able to maintain the 

fiurctioning of its ecological systems and coexist with it. 

The pokt is that lwal forest land must be managed based on 

the: values expressed by lwal citizens who are felix with 

lheir smounding landscape and its ~que features. 

g, as mauldated by Federal laws, runs the 

risk of failing to adequately reflect the relationship of local 

residents to their lmdscape even as it tries to balance 

preservation and hm-esting interests in the aggregate. Ths is 

again a problem of scale, but one oftbe scale of management. 

Thus, we believe that local values must form the basis for 

managing local forests and serve as the foundation from 

which the larger scales of management must be derived. 

Assessing Scalar Public Values 

With local values as a starting point, the task assessing these 

values requires at-tention. Using SagoEs (1 988) hpothesis 

that citizens may make different choices depending on the 

context of a question, we can formulate a procedure for 

assessing public values in d%erent time fiames. Assuming 

three levels of values-individual, intergenerational, and 

evolutionary-three time horizons can be considered. These 

do not represent absolute time periods but ranges reflecting 

the daerent contexts for consideration of values. 

To assess "individual" values for local forest management in 

the short term, members of a local comu~ty can be asked to 

state their preferences in terms of the present. In this context, 

it is lrkely that they will assume the current rules of economics 

and express values based on present worth, discounting 

benefits that accrue in the future. In this case, citizens might 

express a preference for timber harvesting jobs or recreationn-elated jobs om increased protection of natural resources. 

The values expressed in thris context should be consistent with 

those assessed using traditional economic methods. 

Next, in the context of a "constitutional convention," 

com~ty members could be asked what values should 

guide forest management over the long term, including what, 

if' any, environmental "goods" should be maintained for future 

generations. That is, ignoring your current situation, how 

would you rewrite the rules for your chldren? In the context 

of suggesting resources or natural features that they wish their 

great-great-grandchildren will be able to utilize andlor 

experience, citizens may mod@ their usual discomting 

across time because they are not constrained by their current 

econornic sihiation (Norton, in press). In this context, citizens 

may express a desire to preserve a certain vista or ensure that 

future generations will be able to fish in a particular river, 

lake, or stream. These are the values that may not be captured 

by traditional methods because they represent values that 

operate on a dBerent scale than short-tern econornic 

concerns. They are values that are not necessasily exclusive 

of present-oriented concerns for employment. 

'ty members may be asked what 

the very long term. Values at this 

scale could be a desire to ensure the 

species or alternatively a more inclusive value that reflects 

concern for the e potential of other species and 

natural vstems. mg the impact or reducing the 

possibility of global clhate change might be il value 

expressed in this context. These values as well as those 

previously discussed can be transformed into management 

goals at various scales that provide constraints on local-level 

management activities throu& a multi-scalar mmagement 

system. 
However, the process of msessing these values may not be as 

simple as ga~e~g citizens together and =king them 

questions about their economic and envkomental mlues. 

The problm is that non-econo~c values ssociatd with 

parlicular places and envkomental features may not be 

ed by individuals. Edward Relph suggests 

that the landscapes wiLhin wbich we live are "inconspicuous 

backgounds" to our everyday experiences: "For much of the 

the, landscapes stay as unobtrusive backgrounds to other 

more importmt concms, but occasionally they are brought 

forward into our awareness . . . in certain &ective states . . . 

we may be predisposed to notice the world around us" (1 985: 

p. 24). On the local level, the value assessment process can 

serve to draw out this background and its scalar dhensions. 

Fdemore, the local view of the swomding landscape may 

not be captured by descriptions in "scientrfic" language 

wugerauer 1 985). 

Mugerauer (1 985) suggests that "enviromental 

hermeneutics" can be snnployed to discover the subtle 

relationship between a cornmu~ty and its local enkrkoment. 

This involves an understanding ofthe local lamage asld the 

meaning of the environment within that language and the 

meaning of the environment within that language including its 

historical dimensions. Ths does not mean that 

anthropologists or linguists must be dispatched to assess the 

value of the environment and its specific features for a local 

comunity. It merely implies that a more interactive 

approach should be employed to draw out these values. An 

ongoing discussion between local residents, forest managers 

and scientists that educates the citizens about ecologcal 

relationships can draw out these values and the ecological 

importance of the landscape in the "background" of the 

features they value. 

An interactive approach to assessing local values has an 

additional &vantage. In a highly mobile society such as ours, 

there is little time to develop experiences with a particular 

place as we move &om one location to mother; people don't 

have the time it takes to reco e and experience the feahures 

of one's smounding lmdscape. h interactive valuation 

process can educate residenb about their local place and 

bring about a reco@tion of the lanhcape and values 

associated with mainta&g larger-level prwsses. This 

allow them to make more educated decisions about the 

values and goals they choose for the managrzment of public 

forest lands. 

Though this kteractive value assessment process, local 

values provide two pieces of infomation for multi-scalar 

management: (1) values to emphasize in the management of 

the local area and (2) values that need to be maintained by 

lasger-level systems. These values can then be used to 

both economic and envimmentstl resowcemanagement goals supported by the local residents. 

Translating Values into Scalar Management Objectives 

An interactirie approach is not only necessasy from a value 

assessment perspective, but it also procrides the means 

through which to deteee appropriate hersuehcal models 

and management goals for forest managers. As noted earlier, 

becawe specific management goals cmot be understood 

prior to scientific understanding, developing goals and 

hierarchical models that characterize the dynecs that aflFect 

valued natural features should be an experirnental and 

interactive process. Biologists and ecologists must be part of 

this process to help the public and forest managers defme the 

appropriate spatiotemporal scale on which to define the 

system to be managed (Norton 1992). Through an interactive 

and experirnental process, the boundasies of the system and 

the ecological dynamics relevant to those objectives can be 

identified and appropriate goals for management can then be 

debd (Norton md Ulmwicz I 992). 

On the local level, individual values can be used to defme the 

boundaries of the system to be managed and linked to 

appropriate dynamics at that scale. For example, to maximize 

job oppoMties for a timber cornmunit?;, silvicultural 

techniques for economically sustainable timber management 

have been well developed. The forest can be maintained in 

several different ways including the use of even-aged stands 

with clearcutting or old growth uneven-aged stands with 

selective cuts, as well as other types of practices. At this 

level, the boundaries of the system to be managed are usually 

defmed at the stand level, which is about 100 hectares or less 

@dorris and others 1992). At this scale, site factors play an 

hportmt role and represent tke relatively stable context 

wih which the trees of a stand grow. These include soil 

conditions (especially nutrient flows), topogaphy, aspect on a 

slope, and climate (Spm and Bmes 1980). 

Conversely, the value of m kg recreational ant-actions 

could translate into the mmagement goal of establishing and 

mainta~g a "wilderness" area. Since wilderness areas are 

not confrned to a single forest stand but represent a collection 

of various forest habitats, the scale of mmagmnt for these 

systems must necessarily be larger. The boundkes of the 

area to be managed might be set at the range of the largest 

ranging species moss and Harris 1986). In this case, it is 

important to manage for diversity wib the management 

unit. Ths might involve mrn technical interference in 

nawal forest development so that plant and animal 

asswiations develop and natusal forest succession proceeds 
empted by man Moms and others 1992). 

Mmagement may also involve some protection from impacts 

such as recreational use and, in more interventionist practices, 

fire suppression. 

In our approach, intergenerational values represent social 

constraints on shorter-term preferences, These values are 

associated with longer time horizons and will generally 

correspond to management objectives at larger 

spatiotemporal scales. These hiber-level objectives provide 

the basis for constraints on management practices at lower 

levels, because to maintain a natural "good" expressed by 

these values over this longer time frame; the ecological 

processes of the relevant system at this scale must be 

maintained. This means that once an intergenerational value 

is translated into a relevant hierarchcal system and 

management goal, the lower-level components that contribute 

to that system should be constrained by appropriate limits. 

Thus, a larger-scale management propa can be established, 

as defined by intergenerational value choices to monitor and 

coordhate the activities of lower-level forest mmagement. 

For example, the major outputs from catchment basins 

include water and its associated load of dissolved nutrients 

and particulate matter (Nelson 1970). The transport of 

soluble nutrients is a primary concern in terms of the health of 

aquatic systems because of the adverse impacts of increased 

concentrations of pho;sphorous and nitrogen. (Morris and 

others 1 992). However, sedimentation from soil erosion and 

rates of water yield can also have a si@eant impact (nilConris 

and others 1992). These factors represent the prFncipal issues 

of concern in terms of managing the forested watershed to 

m-e aquatic impacts. 

When combined with assessments of the cwent health of the 

aquatic qrstems of concern, these variables can be converted 

into appropriate managernmt goals that would then have to be 

kcorporated into local management plms. Ths does not 

mean that unrfom restrictions on specific activities, such as 

fedilizer use or cleascuaing, would be placed on all lmds 

wi~n he watershed. hstead a watersbed-level hyBrologrc 

model could be usd to iden%@ where hi&er levels of 

I'ertilker are lkely and unlikely to adkrersely impact the 

aquatic qstcm. This mans that economic forestmanagement, in ac~ordance with the bcal values in spectfic 

areas, could continue as long as the practices did not violate 

the watershed-scale requirements for mahtenance of the 

aquatic systems. 

hportmtly, studying natural dy.n~cs and expe~enting 

with conservation practices provides bo~ scientific progess 

and increasing public knowledge of the role of ecosystem 

dyn~cs in maintaining publicly valued resources and 

nahual feames. Though such an tipproach, hierarchical 

models and management objectives can be sorted out 

according to their usefuhess in clartfying, explakg, and 

achieving public goals (Morton 1992). 

Integrathg Values at )Iigher Levels 

Before a multi-scalar management strategy can be fully 

defined, the longer-tern intergenerational values of local 

citizens must be integrated with the values of citizens in other 

local areas. On the local level, the basic principles of 

econoAcs may be used for determining management 

activities because they are compatible with the values at tlxs 

scale. However, local practices defined by these values 

operate with higher-level constraints in our approach. Since 

htcrgenerational values are associated with the longer tern, 

the conesponding ecological systems and dyn@c processes 

that maintain a resource or natural feature in that time horizon 

generally occur on larger scales, which may require the 

management of practices outside the boundaries of the local 

CO 

In such a case, citizens hm all com~ties with 

intergenerational values that require landscape-level 

management must be brought: tol;ether so that they can 

achieve a consensus on what the management goals for higher 

levels should be. In this mmer, the higher-level constrakts 

that are hposed upon local management activities kou@ 

landscape-level mmagement will not be forced -from the "topdown" but will be based on local values with knowledge of 

the particulars of local ecosystems. Using the process 

described above, it mi@t be dete~ncd that m ' 

* 

viable fish populations in riwrs and lakes is im the 

residents of several c ties. For example, by ageement 

residents wi~ an sea mi&t conclude that they wish to 

maktah one pwicular fork of a river or, on the other hand, 

lhey ~&t wish to mahtak all the rixrs in their area. If they 

chose to mainth all the rivers in tkte mea, the wtllersbed to 

be managed would be much luger thm just one fork. In each 

case, landscape-level management would apply certain 

conslr&ts on forest mmagement practices wi~ the 

corresponding watershed. A s~lm integation could 

theoretically be performed for global-level concerns, althougb 

the dSiculties of doing so are quite large. 
In conclusion, what we have proposed is an altema~ve to 

kditional approaches to forest management. It is intended to 

provide eonsbaints on econoGc forest management when 

those practi~es may intedere with the rnaintenanee of 

resows and namal fealures that are valued by the public for 

the longer-term. It is a multi-walw managaent system 

based on locally assessed values, which attempts to provide 

relevant ecological idomation and, thus, facilitate those 

value choices through an interactive and ongoing process 

involving forest managers and ecological scientists as well as 

the public. Through this system of ecologically informed 

scalar management, we believe our approach provides a 

framework for addressing multiple public values which can 

meet many of the challenges facing forest managers today. 

Perhaps most hportantly, our approach seeks to facilitate a 

system of forest management that can maximize fulfillment of 

public preferences by developing ecological models that 

characterize the variables and dynamics relevant to publicly 

valued resources and natural features at various scales. 

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goals for environmental management. Washington, DC: Island Press. 

Cronon, W. 1983. Changes in the land: indians, colonists, and the ecology 

of New England. New York: Hill and Wang. 

HaskeU, B.D.; Norton, B.G.; Costanza, R 1992. What is ecosystem 

health and why should we wow about it? In: Costanza, R.; Norton, B.G.; 

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MacKenzZe, J.J.; EI-As-, M., eds. 1989. Air pollution's toll on forests 

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Seamon, D.; Mugerauer, R., eds. heliing place and envuommt: 

towards a phenomenology of person and world. New Yo* CoIumbia 

University Prw. 

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paradigms. Ecological Economics. 

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hierarchical approach. Ainbio. 2 1 :244-49. 

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diversity at all scales. Environmen(a1 Management. 10(3):299-309. 

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O'Neil, RV.; Debgelis, D.L.; Waide, J.B.; Allen, T.F.H. 1986. A 

hierarchical concept of ecosystems. Princeton, NJ: Princeton University 

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Relph, E. 1985. Geographical experiences and being-in-the-world: the 

phenomenological origins of geography. In: Seamon, D.; Mugerauer, R., 

eds. Dwelling, place and environment: towards a phenomenology of 

person and world. New York: Columbia University Press. 

Sago@ M. 1988. The economy of nature. Cambridge, U.K.: Cambridge 

University Press. 

Salverda, Z. 1968. Ecological consequences of the management of 

catchment areas and the influence of forests on river basins. In: European 

committee for the conservation of nature and natural resources. 

Freshwater: Three studies. Council of Europe. 

Simon, H.A. 1962. The architedure of complexity. Proceedings of the 

American Philosophical Society. Planning in the National Forests. 

Washington, DC: Island Press. 

Spurr, S.H.; Barnes, B.V. 1980. Forest ecology. 3rd ed. New York: John 

Wiley & Sons. 

on, C.F.; Anderson, H.M. 1987. Land and resource plhg in the 

national forests. Washington, D.C. : Island Press. 

LM. 1989. Americasls and their forests: a historical geography. 

Cabridge, U.K.: Cambridge ljniversity Press. 

Morris, L.k; Bush, P.B.; Clark, J.S. 1992. Ecological impacts and risks 

associated with forest management. In: Cah, J.; NiederIePmer, B.R.; 

Olvos, D.R, eds. Predicting ecosystem risk. Princeton, NJ: Princeton 

Scientific Publishing Co. 
Regional Changes in Land Uses and Cover 

Types: Modeling Links between 

Forestry and Agriculture 

Ralph J. Alig, Darius M. Adams, and Richard W. Haynes 

Abstract 

Changes in land use and cover e important components of global 

change, including alteratlorn cqahilities to provide envirommM 

semiem. One mvirommtrtl service receiving increasing attention is forests' 

n, reducing amospheric chn dioxide related 

We abe desi~ng and testing multi-period 

models for evaluating the eEe& on welfare and markets from the large-scale 

fore* pro@= proposed for sequestsrlng additional carbon in terrestrial 

ecosystems. Reliminary results for a case study in the Southeastern U.S. 

Indicate &at effects em be subhGal from dore-tim progatns of several 

million axes, including spill-over eEeds aaoss regions. Reli~ary results 

from a forest and agricultural sector optimization model refled the 

ktemelakd timber hw& aPld reforedtionz decisiom of indu~a! and 

nonindu&al privale owes. Both pnivate omemhips are projected to 

inmeme areas ofpIanted pine up tbrou& 2000 under all scenarios. We also 

s in this lhe of research and possible improvements in 

Introduction 

Concentrations of radiatively hportmt trace gases, such as 

carbon dioxlde, are increasing in the abosphere, largely 

tt-rrough mkopogenic emissions @oughton and others 

1993). Possible changes in the area, coxr types, and ages of 

forests are importmt when exmining carbon sequestration by 

forests in the cont 

forest iund a~cultural uses in the Sc-ubheastern U. S. "ethen 

compare projections of changes in timberland area in the 

Southest &om both a forest sector anode1 afld a model that 

l~s forest md a~eultural sectors. Last, we discuss hhue 

reseasck worhg taward bproved models for projedkg sea 

changes for teneshal eco~skms Ln global change shdies 

md wsessments. 

Morestation is an important option for additional carbon 

sequestration by forests @apes and others 1 994; Moulton 

and Richards 1990). In the United States, opportunities for 

afforestation are the greatest in the South. Because 

land uses &om aacultural to forest, a 

li&ed model ofthe two sectors can enhance analyses of 

welfare and market effects (Adarns and others 1994). At the 

same time, tve need to consider other forest activities. For 

exmple, ankopogenic disturbmes in Southeastern forest 

ecosystems ancf other bum-related factors, kcluding the 

conversion of timberland to urban and developed uses, will 

duence the future condition of Southeastern forests. 

Historical Land-Use Exchanges Between 

Forest and Agricultural Sectors in the 

Southeast 

The Southeastern U.S. is an important timber supply region, 

and its 88 rnillion acres of forest land equal 12 percent of the 

United States total (Powell and others 1993). Forest land 

covers 60 percent ofthe Southeastern landscape and consists 

of areas at least 10 percent stocked by forest trees of any size 

and areas fomerly stocked to this level that will be 

regenerated naturally or artificially. If national averages rue 

used, the current forest area represents about Wo-thirds of 

tivhat was forested in the Southeast in 1630. Most of the 

forest has bem converted to agriculture, but opp 

redlocatkg some of the rnaraal and emiromentally 

sensitive agricultural land back to forests are substtunlial, wi& 

esthates ran&g from 10 to 30 fillion acres in the South 

(IVloulton md fichasds 1990; USDA Forest Senice 1988). 

USDA Forest Service, Pacific Nohwest Research 

SWion, Gomallis, OR; Rofesscr, tinivmity ofMonlana, Missoila, MT; and 

Program Manager and Rmearch Fore*> L'SDA Forest Service, Pacific 

No&we;rt klmeaash Shtion, Portland, OR Irsgecliively). 

"cultural uses in this paper refer to mop land and gareland. Rage 

land is considered a nrinor land use in lhe SourUleasl. The SouIhe 

regon consi* of Florida, Georga North Caaolh% Sou& Carolina, and 

tiit~a. 

In parts of the Southeast, land has repeatedly smed back md 

fortb beWeen. agriculture and forest uses in this cenw. For 

the frrst time since 1600, forest area stopped decreasing 

around 1 920, when the conversion &om forest to adculture 

slowd appreciably. Crop dsunage from the boll weevil, 

d, and adjustmernts in the agricultural 

economy prompted many s to abandon their land in the 

l 920% sand 1 93 0's. This process ws accelerated, in pat2 by 
the bat Depression (Powell and others 1993), and many 

reverted to forest naturally. Cropland 

in the 1950's and early 1960's but increased 

during the following 20 years. A large jump in the 1970's 

was fueled by expanded global demand for amcultural 

exports. 

Around 1980, the National Agricultural Lands Study was 

initiated in response to the apparent loss of prirne cropland to 

urban and other uses. However, subsequent data indicated 

that these concerns were, in part, unfounded. Moreover, 

reductions in export demand for agricultural products 

decreased pressures on agricultural output. Congress passed 

the Conservation Reserve Program (CW) in 1985 to convert 

about 40 million acres of erodible cropland to other 

vegetative covers. Under the CW trees have been planted 

on about one million acres of erodible cropland in the 

Southeast, whch represents 40 percent of the acreage planted 

under this program in the United States. 

In the late 1 980is, concerns about cropland availability 

sh. The second RCA Appraisal VSDA 

SC S 1 989) projected over 1 00 million acres of idle cropland 

in the United States under the assumption of reduced 

programs. 

Tree planting on all ownerships increased appreciably after 

1950 (Alig and others 1990a). The area of planted pine in the 

Southeast increased more than ten-fold between 1952 and 

1985, from 1 .O million acres to 12.6 million acres. The 

majority of the planted pine is on forest industry lands (fig. 1); 

however, the nonindustrial private forest (MPF) ownership 

contains most of the opportunities for additional tree planting. 

In the Southeast, the Nlli"F ownership embodies 70 percent of 

the timberland2 and essentially all the afforestation 

opportunities. 

IEEINIPF volume 

El Forest industry volume 

HNIPF area 

l Forest industry area 

Sofhvood Hardwood Sofhvood Hardwood 

area area volume volume 

Figure 1-Areas of softwood and hadwood timberland, in millions of acres, and sohood and hardwood gowing stock volumes, in 

billions of cubic feet, by private ownership in the Southeast, 1992. 

Timberland is forest land that is not reserved for other uses and is capable of 

producing crops of industrial wood. 
Crop and forest uses have shifted considerably on the NlPF 

omership, duenced in part by govement programs (Alig 

1985). Mfiough some cropland has reverted to forests, the 

area of tkberland in the Southeast has continued to decline, 

especially on the NIfF ownershp (Powell and others 1993). 

Even with CRP, the nation's largest tree planting program 

ever over a 5-year period, timberland area continues to 

decrease. Timberland area in the Southeast dropped from 

85.2 million acres in 1987 to 84.8 million acres in 1992 

(Powell and others 1993), and about 50 percent of the 

reduction oecwed on the NlPF ownership. However, this 

does represent a slowing in the rate of loss of forest area when 

compared to the 2.5-million-acre reduction between 1 977 and 

1987. 

In smary, excess land in the agricultural sector contributes 

to an uncertain future for the direction and rate between the 

shnfting of land between agriculture and forest. Continued net 

conversion of forest land to urban and developed uses is 

likely, given the projected increases in population and 

personal income. As the current CRP tree planting program 

ends, policy makers are considering its renewal on a smaller 

scale. Even ttus scaled down program would imlude tree 

planting on erodible pastureland and other programs that 

could sequester additional forest carbon. Tens of millions of 

acres of marginal and environmentally sensitive cropland and 

pastureland, primarily in the South, are suitable for planting 

trees (141oulton and Richards 1990). Some of that area has 

already been planted through government programs like the 

CW, and we now look at what might happen to timber 

markets rf large areas in the remaining suitable acreage are 

planted to trees. 

Modeling Impacts on Timber Markets from 

Tree Planting Programs 

A policy issue with hplications for multiple natural resousce 

users is the possible consequences of competition for lmd 

between the forest and agrrcultural sectors and conversion of 

some timberlmd to usban, developed, and reserved uses. 

With these possible land-use sMs, modelers must explicitly 

consider the pathways for land moving into and out of forest. 

Land is converted from forest to apculture when the present 

value of expected land rents in agricultural uses exceed that 

from timber growing and from agriculture to forest when the 

reverse is true (Alig 1985). Wen included in natural 

resource models, conversion of forest land to urbddeveloped 

use has been typically modeled exogenously, as illustrated in 

the projections for the 1989 RPA Assessment (Alig and 

others 1990b). 

Forest Sector Model 

In earlier large-scale appraisals, the TAMMIATLAS3/Area 

Change modeling system has been used in regional and 

national forest assessments in the United States (Adarns and 

Haynes 1980; Haynes 1990). As part of a group of linked 

models, TAMM is a regionalized timber market equilibrim 

model that projects production, consumption, and prices in 

product and stumpage markets. The ATLAS component 

projects limber kventoq volumes on timberland by 

ownership and region (Mtlls and Krncaid 1 992), using 

exogenous projections of timberland area by owner, region, 

and forest cover type from Area Change models (Alig and 

Wear 1992). The ATLAS model uses timber removal 

calculations from TM to project timber inventory volumes 

and grow&. This information is then fed back to the TAMM 

model, for recalculating the equilibriu level of timber 

removals; the process is repeated iteratively until a tolerable 

convergence is reached. In a related application, Haynes and 

others (1 994) analyzed opportunities for sequestering 

additional forest carbon under scenarios that included 

recvling, tree planting, changing levels of public timber 

harvest, and other policies in the United States. 

Linked Forestry and Agriculture Model 

sectors to mdel land-use competition (Mas and oehers 

lationships and data &om the 

hmge modeling vtem to m&l the 

harvesting, and demand for 

delivered logs in an intertemporal opt 

Timberlad hesstnent Mtlsket Model VMWmegate Timberland 

(ATLAS); for a discussion of a recent applicrrtion, see 

Kaynes (1990). 
that includes land-UF~ alloeafion (figure 2). Timber yield 

estimates and cast estimates for tree esthlishent and 

management woulton and Rich%& 1990; Birdsey 1992) are 

in g afforestation oppoMties. These data 

are supplement& with forest-smey plot data used in fhe 

ATLAS model for national thber wsesments. 

The forest sector of FASOM depicts the use of existing 

timberland, reforestation decisions on hasvested larid, arid 

&restation of a&culmal land. For example, planting 

agricultural land to trees or intensified management of 

existing timberland influences fbture smpage prices, thereby 

affwting fmancial desirabiliv of timber investments. 

FASOM assumes that owners EUlly foresee and adjust to price 

changes, while fixed price expectations are implicit in the 

T TLASfArea Change modeling system (Haynes and 

others 1994). 

FASOM endogenously selects optimal timber management 

for m&wd and hardwood acres on pivate tiniberlmd. 

Previous models used estimates of timber management that 

were pre-set based on expert opinion. Moreover, part of the 

modeling of timber management includes endogenous 

projectiom of area changes for forest types, whch represents 

an improvement over earlier models. 

Comparing Projections from Single and TwoSector Models 

We used five sets of forest prt?ject_ions for the Soulheast to 

evaluate the import- of different assumptions and 

modeling stances. Two sets are preluninq projections by 

theT TLASIArea Change systm from the 1993 

Resowces Pleg Act (RPA) Assessment Update (I-rapes 

and others, in press): (I) the baseline and (2) an afforestation 

d in the 1993 RPA Assessment Update. The 

remaining three sets are prel%ary projections from the 

FASOM model: (3) baseline; (4) afforestation scen&o, with 

the same amount of exogenous afforestation imposed in (2); 

and (5) bafeline for a forest-only version of FASOM without 

the endogenous links between the forest and agricul~al 

sectors. In the forest-only version of FASOM used in the fifth 

set of projections, no land is transferred in response to market 

forces befween forest and agriculture. Exogenous or pre-set 

transfers of timberland to urban/developed uses are imposed, 

and exogenous or preset timber1 

under existing govement costhposed. 

Inputs: 

* Existing timber inventory by land type, owner, forest type, site, 

management intensity, and age cohort 

* Existing timber yields - sawlogs, pulpwood, and fuelwood - softwoods / 

hardwoods 

* Regeneration and afforestation yields 

* Establishment costs 

* Growing costs Input data for: 

* Land transfers * 33 primary commodities * Public timber harvests * > 200 production budgets 

Sum of sources of reforestable 

tand = Sum of areas of uses 

of reforestable !and 

Ag. areas assigned to forest species 

types; ag. suitability classes in forest 

sector linked to tand types in ag. sector 

-Aloeation of private agricultural land and timberland 

- Level of private timber management and forest type areas 

- Production, consumption, and prices 

- Forest carbon 

Figure 2-Schematic of linked Forest and Apculhral Sector Model (FASOM) 
Changes in timberland area influence market prices and 

quantities in t~o importmt ways. First, when area is shifted 

to non-forest uses or converted to other timber types, at least 

part of the timber inventory is usually marketed and 

contributes to current harvest. Second, in the longer tern, 

area changes either increase or reduce the aggregate forest 

grow& and inventory potential. The degree of the market 

response will depend, in part, on how timber investors 

respond to the associated stumpage price changes. In 

addition, higher stumpage prices could dnve up resource 

costs, resulting in regional shifts in production, as illustrated 

when recent public timberland withdrawals in the Pacific 

Northwest shifted production to other regions. 

In this paper, we are primarily interested in what the 

alternative sets of projections indicate about the welfare and 

market impacts of large scale increments of tree planting on 

NIPF lands, including any regional spill-over effects. In table 1, 

we report prelinlinstsy mode1 outcomes in terns of 

projected areas of planted pine and softwood inventories in 

the Southeast. In this section, we discuss selected findings 

from preliminary forest resource projections (as of early 

1994) to illustrate types of changes in forest area and timber 

inventories that may affect carbon sequestration by forests 

under different scenarios. Others (Adams and others 1994; 

Birdsey 1 992; Turner and others 1993) are translating 

projected forest inventory changes into carbon sequestration 

changes, which is outside the scope of this paper. 

RPA Assessment Update Baseline 

The RPA, as amended by the National Forest Management 

Act of 1976, directs the Secretary of Agriculture to prepare a 

Renewable Resource Assessment each decade and a 

Renewable Resources Program every 5 years. The 1993 

RPA Assessment Update analyzes major changes in supply 

and demiind since the 1989 RPA Timber Assessment (Haynes 

1990). Key assumptions on the supply side pertain to 

investments in tree planting and intensity of timber 

management. 

In the 1993 RPA Assessment Update, timber investment 

assumptions daer markedly for the NLPF and industrial 

private owerships. For example, in the Southeast, forest 

industry owers are projected to convert a substantial 

proportion of natural pine and hardwood forest types to 

planted pine over the next several decades WSDA Forest 

Service 1 988). Industrial owaers reforest substantial amounts 

of timberland with plantations and manage timber relatively 

intensively (e.g., precommercial thinning, fertilizing, and 

commercial thinning) (Alig and Wear 1992). In contrast, 

fdIPF owners follow historical trends of less intensive timber 

management but are receptive to govement programs of 

technical and financial assistance for reforestation and 

afforestation. 

Opporhurities for increasing productivity on timberlands in 

the Southeast are substantial, and many offer attractive 

financial rates of return (Haynes 1990). Only a part of this 

potential increase in productivity on timberlands is reflected 

in the RPA baseline projections. Potential changes in climate 

could also affect future productivity (Burton and others, in 

press). However, the WA baseline assumes a future in which 

the climate follows historical trend^.^ 

NIPF soAurood timber inventories in the Southeast are 

projected to fall steadily through 2040 (table I), while the 

area of planted pine increases by about 4 million acres 

between 1990 and 2040. Softwood growing stock inventories 

on forest industry timberland are projected to increase 

through 2040, while planted pine area increases by 

approximately 4 million acres from 1990 to 2040. The 

combined effect on private softwood timber inventories is a 

projected reduction through 2020 and an ensuing increase of 

about 6 percent by 2040. 

Tree Planting Program Under 1993 WA Assessment 

Update 

Policy makers have considered expanding tree-planting 

programs to increase the amount of carbon sequestered by 

forests. Moulton and Richards (1 990) document the 

availability and cost of converting rnargnal and 

environmentally sensitive crop and pastureland for tree 

planting. Other studies (e. g., USDA Forest Service 1 988) 

suggest that much of this area would be economically 

attractive for tree planting, particularly in the Southern U. S. 

even without factoring in the social benefits of carbon 

sequestration. 

Based on a scenario where 5.8 million acres of pasturelad 

are afforested in the south-central region by 2000 (Haynes 

and others, in press), the 1 993 version of TmATLASI 

Area Change models projects smpage prices similar to 

baseline projections up to 20 10. AAer 20 10, they fall below 

baseline projections for the Southeast. The effects of the tree 

planting in the south-central region spill over into the 

Southeast and depress smpage prices from the year 2020 on. 

An alternative fkture is included in the WA Assessment Update that 

explores the forest-resource in~plications of sigruf~cant change in the earth's 

climate. 
Table 1--Cornpanson of projected areas of planted pine, in millions of acres, and softwood growing stock 

inventories, in million cubic feet, for forest industry and NIPF omerships in the Southeast, under five 

alternative projections 

Projection Year 

Forest induse 

1993 RPA 

Update Baseline 

Planted pine area 

Sof'twood inventories 

1993 RPA Update 

Tree Planting 

Planted pine area 7.3 9.7 11.0 11.2 

Sof'twood inventories 10,750 1 1,988 16,565 24,872 

FASOM Linked: Baseline 

Planted pine area 

Softwood inventories 

FASOM Linked: Tree Planting 

Planted pine area 

Sof'twood inventories 

FASOM Forestry-Only Baseline 

Planted pine area 

Sof'twood inventories 

1993 RPA 

Update Baseline 

Planted pine area 

Sof'twood inventories 

1993 RPA Update 

Tree Planting 

PI anted pine area 

Softwood inventories 

FASOM Linked: Baseline 

Planted pine area 

Sohood inventories 

FASOM Linked: Tree Planting 

Planted pine area 

Sof'twood inventories 

FASOM ForesQ-Only 

Baseline 

Planted pine area 

Soh& inventories 
Using a 1989 mdel version , Hapes and others (1 994) 

shulated the forest resowce and masket hpacts of this 

scenario. TCesulb showed wmewhat larger effects on 

stumpage prices than the 1993 model. Even when tree 

planting is spread over 10 years, sizable increments of 

merchantable timber are eligible to enter certain key timber 

markets as the trees start to malure. In the phary region of 

tree planting, the South, smpage prices are notably 

depressed after 20 10. 

FASOM Preliminary Baseiie 

Projected softvvood inventoq levels in 2000 are lower under 

the preliminary FASOM baseline than those from the 

T TLASlArea Change model. Projected softwood 

inventories are lower for both the forest industry and NIPF 

ownaships because private owners harvest more timber and 

plant more area to pine in the first decade. However, later in 

the projection period, private soAwood inventories are 

notably higher than those under the TWATLAS/Area 

Change baseline. Higher inventory levels result from a higher 

mount of accmulated tree planting in the FASOM baseline, 

reflecting the financial attractiveness of planting opportunities 

identified in earlier studies (e. g., USDA Forest Service 1 988). 

Treeplanting Program with Preliininary FASOM 

Linked Model 

Prel~q FASOM projections for a tree-planting program 

of 5.8 million acres in the south-central region dFffer in some 

notable ways &om those with the TAMMIAnASIArea 

Change model. In particular, stumpage prices projected by 

FASOM after 2010 do not fall as much. This occurs, in part, 

because forest owners foresee long-tern price changes and 

adjust to them kediately. With perfect foresiat, both 

groups of private owners effectively adjust in the first decade. 

In total, compared to the T TLASIArea Change 

projections, more timber is hmested and area reforested in 

the first decade, which redwes htwe price changes. 

Anolher dfierax be&- methods &om the hivo sets of 

models is that the FASOM model projects the block of 

dorested acres to be hmested as a goup and then conve~ed 

back to aagriculhual use &er harvest. Thus, by 2020, the 

projectione~th and without the ke-planting 

progm4Ber little within the FASOM set. In wntrst, 

building in the tra planling progrm causes the 

T TLASIArea Chmge projections to dser 

substantially in &at projection period compared to the 

baseline. 

In a related study, which lacked a dynamic forest modeling 

component, Adms and others (1 992) analqzed the social 

costs and impacts on timber and agricultural markets when 

sequestering carbon by tree planting. Results indicated a 

rmgc: of outcomes, inciuding higher food prices and werase 

losses for some private forest land owners. Total social costs 

rose drmatically with increases in tree planting. Projeetd 

impacts on the agricultural sector (e.g., agricultural 

production) relative to the forest sector were small for a treeplanting program of 50 million acres. For the forest sector, 

economically dismptive impacts of large-scale tree planting 

are consistent with those projected by Haynes and others 

(1 994). 

Forestry-Only FASOM Preliminary Basehe 

To test the msitivily offorest resource projections to reduced 

land competition, the agsiculture sector in FASOM was 

deactivated for this set of "Forestry-Only" projections. The 

projections for the NIPF ownership are affected most when. 

compared to the FASOM-linked baseline projections, with 

projected areas of tree plrtnthg IrnigPler in the fust part of the 

projection period under the Forestry-Only mode. Less 

competition for land reduces oppoMty costs associated 

with alternative land uses and also causes forest industry to 

plant more acreage in the first decade. The planted area 

under the Forestry-Only scenario increases ~i~cantly when 

hardwood acres are converted to planted pine on the NlPF 

ownership. Proportionately less hardwood acres are available 

on forest industry lands for conversion to pine (see fig. 1). 

Summary 

Projected near-tenn impacts of &orestation on sturnpage 

markets are relatively small in TWAnAS/kea Change 

projections, but prelGary FASOM projections indicate 

iate adjjustments to market signals by private omas. 

In the FASOM model, omers adjust optimally in their 

reduced future shunpage prices. In contrast, the 

TLASIkea Change modeling qstem projects a 

relatively large increase of tree pldations in a neighboring 

region, which depresses stumpage priees after 20 10. These 

effects are &end strongly by the assmd response: of 

WF and ofher private owners to market signals and their 

ability to foresee price changes. In the real world, markeb 

and owners probably respond somewhae beween the two 

exlsemes. Becaw tree planting may substmtially boost 

htufe hber inventories, the possibiliv of greatly depressed 

thber rnwkeb in decades bears some wnsideration by 

policy designem. 
Discussion and Next Steps 

The sets of alternative preliminary projections indicate that 

forest area is a key de ant of future long-term forest 

invento~es, which influence stumpage prices and returns to 

landownas. The relatively rapid djustments in markets and 

by landowners indicated by the FASOM model are sometimes 

different &om the observed behavioral tendencies of NIPF 

owners. For example, study of the fate of subsidized 

platings indicates that they tend to stay in trees afker 

government contracts expire (Alig and others 1990a). 

The possibility of govmental intervention in markets also 

complicates attempts to project forest resource changes tied to 

owner behavior. The Southeast is particularly likely to be 

influenced by agriculture and forestry programs because so 

much land is suitable for both purposes. Agricultural 

programs have influenced forests and forestry by encouraging 

the cropping of forest land. Such agricultural programs have 

affected the forest ld base and the forest types because land 

returned to forest through government programs is generally 

planted to pine. In the Southeast, agricultural programs have 

probably contributed to a net loss of NIPF timberland area of 

7.8 million acres between 1952 and 1992 (Powell and others 

1993), while tree planting programs have contributed to the 

4.4 million-acre or eight-fold increase in NIPF planted pine 

area between 1952 and 1985 (USDA Forest Service 1988). 

In total, forest policies influence land use allocation less than 

they alter forest management through subsidy programs (e.g., 

Forestry Incentives Program), tax incentives, and technical 

assistance. 

The mount of land-use change is also affected by decisions 

about other variables, such as intenslfjring timber 

management and transfers of land between owners. The 

NIPF ownership accounts for all projected private Gmberland 

losses in the 1993 RPA Update baseline. The losses 

attributed to ownership shifts through acquisition of NIPF 

timberland by the forest industry represent a relatively small 

part of the total projected net decrease. 

In recent years, major progams or policies with hplications 

for future forest area have been implemented. The CRP has 

added over 2.5 million acres of thberland, pkarily in the 

South. The Fm Bill will be considered for renewal in 1 995, 

and related developments should be monitored. Signrficant 

unmty inherently accompanies long term projections, and 

the direction and extent of land-use exchanges with 

agriculture are an impofiant part of the uncertainty associated 

with future forest-area projections (Alig and Wear 1 992). 

Next Steps 

The future scenarios suggested by the five sets of preliminq 

projections are based on specific assmptions and the 

unknown evolution of different sectors of the economy. The 

projections are subject to change, and future work will 

address the aforementioned sources of uncertainties in three 

ways: (1) investigation of factors that influence changes in 

forest cover types at a regional scale in the Southeast, 

including economic and demographic variables, (2) 

development of methods for the endogenous projection of 

forest-type changes in a regional timber resource assessment 

system, and (3) projection of forest type changes under 

different future scenarios and evaluation of the economic 

effects of selected forest management alternatives. 

Both natural and economic factors contribute to the amount 

and composition of forest types in the Southeast. We are 

investigating the rate of transition in forest types in the 

Southeast for the last two periods covered by forest-survey 

remeasurements. Information on transition relationships will 

be incorporated into the TWATLASIArea Change 

modeling system. The enhanced modeling system is intended 

to aid in the Southern Global Change Program's assessment of 

potential external economic impacts of global change on 

southern forest ecosystems. 

Other Impacts 

Possible improvements in modeling approaches and data 

bases are desirable to analyze the forest resource, 

environmental, and economic implications of alternative 

forest management strategies for sequestering different 

amounts of atmospheric carbon. To increase usefulness for 

policy makers, evaluation of the regional and national impacts 

of expanded tree planting requires a comprehensive 

assessment of both resource-based and market-related 

impacts. Other models that can interface with the 

TAMMIAEASIArea Change and FASOM models can 

provide information on the effects of changes in forest cover 

area and stand structure on non-timber components, such as 

wildlife habitat and forest recreation oppodties. Efficient 

interdisciplinary modeling of these effects is more likely with 

carefully planned linkages between physical, ecological, and 

economic modeling systems. 
Acknowledgments 

Ths research is sponsored by the USDA Forest Service's 

Southern Global Change Program, and the U.S. 

Environmental Protection Agency. 

Other cooperators in a related larger research project include 

Bruce McCarl, Texas A&M University; J.M. Callaway, 

RCGEIagler Bailey; and Steve Winnett, Environmental 

Protection Agency, Climate Change Division.. We appreciate 

the assistance of John Chmelrk, University of Montana; Pete 

Bettinger, USDA Forest Service, Corvallis, OR; Robert 

Moulton and Jeralyn Snellgrove, USDA Forest Service, 

Washington, DC; and Martha Brookes, USDA Forest 

Service, Corvallis, OR. We also acknowledge the support of 

the Environmental Protection Agency's Climate Change 

Division for applying the FASOM model in this study. 

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Service, Southern Research Station. 45 p. 

I Service, Southern Research Station. 45 p. 

I I I I 

I 

I The five papers in this book were originally presented at the 1994 I 

I The five papers in this book were originally presented at the 1994 1 

1 Southern Forest Economic Workers meeting. They discuss the I Southern Forest Economic Workers meeting. They discuss the I 

I socioeconomic aspect of global climate change on forests. The research I socioeconomic aspect of global climate change on forests. The research I 

represented by the studies will assist decision makers in the formulation represented by the studies will assist decision makers in the formulation I 

I of policies concerning global climate change. I of policies concerning global climate change. I 

I 

I I 

I Keywords: Economic models, forest management, global climate change, I Keywords: Economic models, forest management, global climate change, I 

I timber market. timbermarket. I I 

I 
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of multiple use management of the Nation's 

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