Estimating the Long-Run Impact of Forest Fires on the Eucalyptus Timber Supply in Galicia, Spain

Manuel González-Gómez, Marcos Alvarez-Díaz and Mª Soledad Otero-Giraldez
Authors registered in the RePEc Author Service: Mª Soledad Otero Giráldez

No 1206, Working Papers from Universidade de Vigo, Departamento de Economía Aplicada

Abstract: Using annual data, we have estimated the timber harvest of eucalyptus in the region of Galicia (Spain). The explanatory variables considered were price, pulp exports, and salvage timber. The latter variable was used as a proxy for forest fires. The problems related to spurious regression were addressed by applying the bounds testing approach to cointegration, and confidence intervals were constructed using the bootstrap technique. The results indicate that pulp exports have a positive effect on the harvested timber volume. Moreover, we find that salvage timber positively affects the timber supply. This result indicates that there is no substitution between salvage timber and non-damaged timber. It also suggests that the natural expansion of the eucalyptus in Galicia compensates for the destruction caused by forest fires, avoiding supply shortages. On the other hand, and according to the economic law of supply, the timber price shows a negative effect.

Keywords: eucalyptus; forest fires; cointegration; ARDL; bootstrap (search for similar items in EconPapers)
Pages: 24 pages
Date: 2012-09
New Economics Papers: this item is included in nep-agr and nep-env
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Related works:
Journal Article: Estimating the long-run impact of forest fires on the eucalyptus timber supply in Galicia, Spain (2013)
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Persistent link: https://EconPapers.repec.org/RePEc:vig:wpaper:1206

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