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Forests 2017, 8(9), 345;

Towards a Theoretical Construct for Modelling Smallholders’ Forestland-Use Decisions: What Can We Learn from Agriculture and Forest Economics?

Department of Forest Resources Management, University of British Columbia, 2424 Main Mall, Vancouver, BC V6K 1Z4, Canada
Agricultural and Consumer Economics, University of Illinois, Mumford Hall MC-710, 1301 W Gregory Drive, Urbana, IL 61801, USA
Food & Resource Economics, Food, Nutrition & Health, Integrated Studies in Land & Food Systems, University of British Columbia, 2357 Main Mall, Vancouver, BC V6T 1Z4, Canada
Author to whom correspondence should be addressed.
Received: 4 July 2017 / Revised: 2 September 2017 / Accepted: 12 September 2017 / Published: 14 September 2017
(This article belongs to the Special Issue At the Frontiers of Knowledge in Forest Economics)
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Academic research on smallholders’ forestland-use decisions is regularly addressed in different streams of literature using different theoretical constructs that are independently incomplete. In this article, we propose a theoretical construct for modelling smallholders’ forestland-use decisions intended to serve in the guidance and operationalization of future models for quantitative analysis. Our construct is inspired by the sub-disciplines of forestry and agricultural economics with a crosscutting theme of how transaction costs drive separability between consumption and production decisions. Our results help explain why exogenous variables proposed in the existing literature are insufficient at explaining smallholders’ forestland-use decisions, and provide theoretical context for endogenizing characteristics of the household, farm and landscape. Smallholders’ forestland-use decisions are best understood in an agricultural context of competing uses for household assets and interdependent consumption and production decisions. Forest production strategies range from natural regeneration to intensive management of the forest resource to co-jointly produce market and non-market values. Due to transaction costs, decision prices are best represented by their shadow as opposed to market prices. Shadow prices are shaped by endogenous smallholder-specific preferences for leisure, non-market values, time, risk, and uncertainty. Our proposed construct is intended to provide a theoretical basis to assist modellers in the selection of variables for quantitative analysis. View Full-Text
Keywords: transaction costs; separability; afforestation; international development; modelling transaction costs; separability; afforestation; international development; modelling

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Baker, K.; Bull, G.Q.; Baylis, K.; Barichello, R. Towards a Theoretical Construct for Modelling Smallholders’ Forestland-Use Decisions: What Can We Learn from Agriculture and Forest Economics? Forests 2017, 8, 345.

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