Investigating the Cooperative Behavior of Nonindustrial Private Forest Landowners when Stands are Spatially Interdependent

This research examines how the harvesting behavior of nonindustrial private forest landowners, and their use of forestland for non-timber amenities, is affected by adjacent landowner behavior. The uncertainty an individual landowner has regarding adjacent landowners' preferences, and how the production of non-timber amenities on their own stands relies on the condition of adjacent stocks, is specifically addressed. Economic characterizations of substitutes and complements are employed to investigate the differences in optimal stock levels at the steady state in the production of amenities under various levels of cooperation among landowners. It is shown that there are externalities present when landowners do not coordinate management actions when parcels are spatially interdependent. The effects of spatial interdependencies on landowner behavior are further explored using data from a survey of forest landowners in Central Virginia. Findings suggest that forest landowners are willing to coordinate activities, and such decisions are determined by similar characteristics that function in predicting landowner behavior regarding timber harvesting. Further, landowners' decisions to use own and adjacent parcels were correlated, hinting at the spatial interdependencies of stocks in amenity valuations. Both the theoretical and empirical analyses suggest that the lack of coordination among landowners and its effects on stock management would be best addressed through the use of incentives to drive spatially efficient outcomes.