NONLINEAR TAXES AND INTERTEMPORAL RESOURCE-MANAGEMENT - THE CASE OF TIMBER

The theory of forest management is applied by estimating a model of ti mber supply under nonlinear income taxation. Timber supply is derived from a two-period optimization problem, which provides a simple framew ork for dealing with intertemporal decisions. A contribution of the pa per is to allow for heterogeneity in the description of the biotechnol ogical properties of the forest resource, The model is estimated using cross-section data over private, nonindustrial forest owners in Swede n by applying the maximum likelihood method. Behavioral resposes to ta xation in terms of timber supply are also evaluated.