Socioeconomic development and demand for timber products - A panel data analysis

The present paper analyses the relationship between consumption of timber p roducts and socioeconomic variables by estimating timber consumption functi ons, using fixed and random effects methods. To this end, we regress the pe r capita consumption of timber products (roundwood equivalent) of a sample of developed and developing countries over the period 1976 to 1989 on vario us national indicators relevant to the development transition. The panel na ture of the data facilitates us to track trends in consumption as economic development proceeds. The results suggest that the response of the timber c onsumption with respect to changes in the variables is sensitive to factors specific to the country concerned. The coefficients of all the variables a re inelastic and it is found that income, density and price are the main de terminant variables although other variables also affect the consumption. T he observations of this study are expected to assist the policy makers in p rojecting future requirements of timber with more reliability. (C) 1998 Pub lished by Elsevier Science Ltd. All rights reserved.