Participation and compensation claims in voluntary forest conservation: A case of privately owned forests in Finland

Abstract

A new market-based voluntary programme aimed at preserving forest habitats on private land has been implemented in Finland. This scheme is based on conservation by fixed-term agreements between forest owners and a governmental authority. In this study we examine the characteristics of forest owners and their properties that indicate the owners' willingness to participate in the programme. In addition, we analyse factors affecting the real compensation claims. The study uses a dual set of data from the pilot project, i.e. one data set supplied by the authority and another collected from the owners involved in the project. The results suggest that to increase the participation rate, information on the conservation project should be targeted in particular to the forest owners who either emphasize financial investment as a motive for forest ownership, have positive attitudes toward nature protection, or own large amounts of forest property. Additionally, owners' positive environmental preferences would decrease and high harvesting value and high ecological quality of a preserved forest stand would increase compensation claims. The voluntary programme could not, however, circumvent owners' strategic behaviour with respect to the claims.