BUYER AND SELLER BEHAVIOR IN SINGLE-BUYER STUMPAGE SALES

While stumpage sales involving a single buyer are commonly observed, w e have no evidence that lack of buyer competition will, in and of itse lf, result in different stumpage prices. Nor do we have an explanation why such sales continue to be made in markets where stumpage owners c an instigate buyer rivalry. Finally we have no theory explaining how b uyers decide what to bid when direct competition from other buyers is not present. This paper addresses these three issues. We offer evidenc e that price differences can exist between single-buyer and multiple-b uyer sales. We show why it can be economically rational for nonindustr ial private forest owners to conduct single-buyer sales. And we offer a theoretical explanation of buyer bid and owner bid-acceptance decisi ons in single-buyer sales that is consistent with some previously obse rved relationships between stumpage prices and owner characteristics.