Risk Aversion and Timber Harvest Strategies: A Case Study of Nonindustrial Private Forest Management in Louisiana

Forest owners face many challenges regarding forest management due to the long period from planting to harvest. Along with the economic and environmental factors that influence management actions, the owners' attitude to risk plays a crucial role in forest management decisions. This study shows that understanding the effects of the owner's risk preference for management actions is an important step to form an effective forest policy. The objectives of the study are to (1) assess the economic advantage of forest management alternatives over a range of risk aversion coefficients and (2) determine the financial incentive (risk premium) corresponding to a forest owners' risk attitude. We implemented the stochastic efficiency with respect to a function framework to evaluate a set of fertilization, herbicide, and thinning management alternatives at mid-rotation loblolly pine plantations in Louisiana. Results from this study indicate that forest owner's risk preference affects their decision to select management actions. Financial incentives are substantially different for specific management alternatives between risk-neutral and risk-averse forest owners. The results can guide forest policy development where agencies can modify financial assistance programs to improve the adoption of management actions.

Assessing Drivers of Forest Conservation in Simancuang Village Forest, West Sumatra

This study empirically assessed Social Forestry program implementation in Simancuang Village Forest or locally known as Hutan Nagari (HN) Simancuang in West Sumatra, Indonesia. We performed two analyses using primary and secondary data, namely propensity score matching to estimate the effects of the enactment of HN Simancuang in 2012 on forest cover loss and ordinal logistic regression (OLR) to predict the determinants of conservation awareness. The results of the forest cover analysis showed that forest cover loss in HN Simancuang between 2012 and 2019 was 0.038 percentage point lower than the adjacent protection forest. The relatively small impact was meaningful because although HN Simancuang is located much closer to settlements which increases the pressure on the forest, it could still maintain lower tree cover losses than the adjacent protection forest. This result indicated a certain degree of conservation awareness among HN Simancuang members, which prompted us to conduct a survey to 111 individuals from different households. To do this, we used the Ecosystem Services framework to conceptualise conservation awareness in HN Simancuang. Our OLR results showed that regulating and provisioning services of forests are the strong determinants of conservation awareness among the individuals in our sample. Our study indicates the need to implement social forestry program monitoring and evaluation, improve access to facilitation, and enhance agroforestry practice as the means to increase conservation awareness among forest-dwelling communities.