The challenge of managing forests for the production of commercial non-timber forest products (NTFPs) lies in promoting economic development by maintaining and even increasing production while simultaneously maintaining or improving ecological conditions. The discussion of forest management therefore encompasses a wide range of social, economic, political, and ecological questions. Empirically, it is clear that both market and government failure can lead to unsustainable management in commercial NTFP use. How can we manage the market and at the same time formulate good policies? Taking cases from Southwest China, this paper critically examines the current development of NTFP commercialization in the mountainous region of Southwest China. It focuses particularly on three pieces of research on mushroom collection and marketing. By examining empirical data, the paper analyzes current gaps in the policy and the market in mountainous areas in the context of promoting sustainable use of NTFP. It examines the market structure from the perspective of market failure and explores the government’s failure to promote commercial NTFPs. We recommend economic and political decentralization, capacity building, and government investment as means to improve sustainable management.
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