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Gale explains why international negotiations have not produced a sustainable solution to tropical rainforest degradation. Using an innovative, critical approach to international regimes, the author analyzes the structure and operation of the International Tropical Timber Organization (ITTO). He shows how the timber industry and producing- and consuming-country governments created a blocking alliance that favoured developmentalist interests and ideas. The ITTO bolstered this alliance by permitting environmentalists merely to voice, but not to negotiate, their concerns.
Originally published in 1994, The Economics of the Tropical Timber Trade provides a detailed analysis of the economic linkages between the trade and forest degradation. Based on a report prepared for the ITTO, it looks current and future market conditions at the time of publication, and assesses the impacts on current and future market conditions, and assesses the impacts on tropical forests of both the international timber trade and domestic demand. The authors examine the causes of deforestation and compare the environmental impacts of the timber trade with other factors, such as the conversion of the forests to agriculture. Finally, they assess the national and international trade policy options, and discuss the potential role of interventions in the international timber trade in promoting efficient and sustainable use of forest resources. The book will be of interest to those concerned with forest management and policy, trade and environment, and with the economics of conversation and resource use.
Scholars have long studied how institutions emerge and become stable. But why do institutions sometimes break down? In this book, Michael L. Ross explores the breakdown of the institutions that govern natural resource exports in developing states. He shows that these institutions often break down when states receive positive trade shocks - unanticipated windfalls. Drawing on the theory of rent-seeking, he suggests that these institutions succumb to a problem he calls 'rent-seizing' - the predatory behavior of politicians who seek to supply rent to others, and who purposefully dismantle institutions that restrain them. Using case studies of timber booms in Indonesia, Malaysia and the Philippines, he shows how windfalls tend to trigger rent-seizing activities that may have disastrous consequences for state institutions, and for the government of natural resources. More generally, he shows how institutions can collapse when they have become endogenous to any rent-seeking process.
The Philippines relies heavily on timber product exports for its foreign exchange requirements. In recent years, however, it adopted log export restrictions as a hedge against the rapid depletion of its timber resources. Although conducted independently, its ASEAN partners (Malaysia and Indonesia), have likewise instituted similar restrictions on their own log exports. Considering the major role of these countries in world hardwood production and trade, these policy developments have become a major concern among the hardwood consuming regions, especially the major importers of hardwood logs like Japan and the Asian entrepots. It is necessary to model the linkages among the various hardwood producing and consuming regions in order to effectively evaluate the effects of specific trade and forest policies initiated by the key producers like the Philippines, Malaysia, and Indonesia. The dearth of previous knowledge and effort in this field prompted the development of such a model. The resulting spatial model consisting of 36 supply and demand equations was used to simulate the short-run effects of several trade and forest policies initiated by the Philippines and ASEAN. Using purely economic criteria, the results indicate that the Philippines will not gain from banning its log exports, but would benefit immensely if ASEAN enforced a log export embargo. Additional tariffs on Philippine timber exports discourage product exports but encourage raw log exportation. Removing the current 4% export tax improves the Philippines trading position at the expense of its ASEAN partners. Simulating the possibility of the ASEAN producers trading with each other indicates they could mutually and simultaneously benefit from such a policy. A major Philippine currency devaluation demonstrates the "beggar thy neighbor" effect through Malaysia and Indonesia suffering immensely from the induced price-reduction of Philippine products. The results of the 13 simulations reveal insights on the mechanics of the interactions between the trading regions and confirm the strong interdependence that exists between the Philippines and its ASEAN neighbors