Shadow pricing diversity in U.S. national forests

Frederick Boltz, Douglas R. Carter, Michael G. Jacobson

Research output: Contribution to journalArticlepeer-review

5 Scopus citations


Tobit estimation of the market value of timber sales in national forests of North Carolina demonstrates the important effect of stand diversity on the formulation of bid prices for mixed-species timber tracts. The hedonic model generates a shadow price for diversity according to changes in bid prices, an effective shift in the demand curve for auctioned tracts due to stand diversity attributes. This approach contrasts with traditional shadow price analyses that focus on the supply effects of environmental constraints. Results are corrected for the effects of bidder participation, market conditions, production costs, and other stand attributes. Econometric results demonstrate that stand heterogeneity is a highly significant factor influencing the market value of timber sales from national forests of the Appalachian region. Greater heterogeneity results in lower bid prices for timber sales, indicating a positive shadow price for maintenance of stand diversity.

Original languageEnglish (US)
Pages (from-to)185-197
Number of pages13
JournalJournal of Forest Economics
Issue number3
StatePublished - 2002

All Science Journal Classification (ASJC) codes

  • Forestry
  • Geography, Planning and Development
  • Ecology


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