Landowner Behavior Research Articles

Seller Behavior in Stumpage Markets with Imperfect Information

Timber supply analysts often prescribe forest landowner behavior by assuming that owners schedule standing timber or sales to maximize the financial return to their investment in forest land and timber investment (USDA-Forest Service 1982; Hyde 1980; Samuelson 1976; McConnell et al. 1983; Pearse 1967). The primary alternative to this investment hypothesis is a utility maximization hypothesis (Binkley 1979) which maintains that stumpage is sold whenever the utility gained from the sales proceeds is greater than the utility gained from both having the trees for recreational, aesthetic, and other purposes and from holding the trees for future sale. Both of these maintained hypotheses presume the stumpage owner has full information about prices, costs and yields. Neither hypothesis assigns a significant role to the costs of obtaining the information needed to make the sale. Observation suggests that the sale of stumpage takes place in a market where information about quantity, quality, and value of product is costly to obtain. Quantity and quality are usually ascertained from a timber cruise which requires professional skill, training, time, and effort. Value is the result of a tallying process which requires both knowledge of how trees convert to logs and other stumpage products and information on the current prices of these products (Beuter 1971). Stumpage buyers, consulting foresters, and professional timberland managers acquire the necessary skills and knowledge to evaluate stumpage as part of their work. But nonindustrial private woodland owners seldom have the opportunity to develop comparable skills or knowledge. The resulting lack of information creates a situation in which the private nonindustrial owner must decide whether to expend time and money to gain stumpage sales information or to negotiate a stumpage sale with limited information. This paper seeks to develop a model of information acquisition and market behavior by timber owners who face revenue uncertainty. Information is chosen ex ante to maximize the expected utility of wealth, following the Sandmo (1971) approach. Acquired information shapes the owner's subjective probability distribution of sales revenue and also may affect the owner's assessment of the value of keeping the timber for recreational, investment, or other purposes. Optimality conditions for information acquisition are presented, and the circumstances in which the owner will find it desirable to collect information are explored. The sales decision of the optimally informed owner is then determined by a comparison between a received bid, the value of having the trees, and a critical bid derived from the optimized revenue distribution. The critical bid is defined as the value which leaves the individual indiffer-

Measuring the effectiveness of public forestry assistance programs

This paper contrasts the effectiveness of fip (a federal timber planting and growing subsidy for non-industrial private forest landowners) and extension forestry in terms of anticipated biological and economic yields. The impact of fip is concentrated in the South, and this paper uses North Carolina as a case study. The paper combines Boyd's general equilibrium model of non-industrial private landowner behavior with Daniels and Hyde's timber supply-and-demand estimates for the same state in order to predict final efficiency impacts. Royer's landowner survey permits further comment on redistributive impacts. The paper finds that neither fip nor extension forestry can be justified on either efficiency on redistributive grounds. Both programs create net welfare losses and both programs transfer larger shares of their payments to wealthier landowners, although the justifications for fip are relatively poorer.

Determinants of Reforestation Behavior Among Southern Landowners

Abstract Accurate models of reforestation behavior are important to projecting the nation's softwood timber supplies and deciding on appropriate public responses, if any, to encourage tree planting. Logistical regression models of the reforestation behavior of southern landowners show the probability of actively regenerating pine on cutover timberlands to be a function of market and policy influences, provided the landowners are in a financial position to consider investments, are not constrained by competing land management objectives, and are informed about reforestation opportunities. Land-owners are most sensitive to reforestation costs, cost-sharing, income limitations, and technical assistance. For. Sci. 33(3):654-667.

Regeneration Following Harvest on Nonindusrial Private Pine Sites in the South: A Diffusion of Innovations Perspective

Abstract The "diffusion of innovations" model is used to explain differences between nonindustrial private forest (NIPF) landowners who regenerated their pine stands following harvest and those who did not. It describes how new technologies and practices (regeneration in this case) are adopted by members of a social system. Differences between regenerators and nonregenerators are explained in terms of socioeconomic characteristics, personality variables, and communication behavior. The mass media are the most efficient means to reach NIPF owners, but foresters may have to employ personal contacts or individual mailings to affect NIPF regeneration decisions. Noneconomic models of NIPF landowner behavior can expand our understanding of the forces that shape NIPF timberland management practices. South. J. Appl. For. 11(1):37-41.

The Land Market beyond the Urban Fringe

Landownership changes in rural areas beyond the urban fringe open the way for shifts to residential landuse. Sellers, buyers, and local government are the chief participants in the rural-urban conversion process in three landuse zones. Their roles are analyzed in the standard metropolitan statistical area of Rochester, Minnesota. CHARACTERISTICS of rural areas in the United States are changing. Houses stand where crops once grew, and the countryside now has more converts to country living than bona fide farmers. The principal landuse change consists of low-density residential construction when people move to areas with a mixture of residential and traditional rural activities. Studies of the landuse changes on the margins of cities are numerous, but there are few examinations of changing ownership, which is a fundamental issue in the conversion process.1 Changes in landownership almost always precede alterations in landuse. Rural landowners play a pivotal role in the process because they decide how their property will be used or when it will be sold for someone else to use. Buyers and sellers of rural property are the actors in the land market who set the course for changes in the human settlement pattern. This study describes the actors in a land market beyond the urban fringe of a small metropolitan region. The analysis sustains some popular notions about the movement of people to the countryside and corrects some misconceptions about persons who have been selling land beyond the urban fringe. The recent housing boom in rural areas calls for an analysis of landowners beyond the urban fringe. In the past, farmers bought and sold most of the property exchanged in the rural land market. Recently, nontraditional owners have been buying smaller parcels at higher prices than farmers have paid.2 Many new landowners consider their property to be a consumptive * The Center for Urban and Regional Affairs, University of Minnesota, provided the funding for this research. I thank John Fraser Hart and James M. Shumway for suggestions that improved this article. 1 Edward J. Kaiser, Robert W. Massie, Shirley F. Weiss, and John E. Smith, Predicting the Behavior of Predevelopment Landowners on the Urban Fringe, Journal of American Institute of Planners, Vol. 34, 1968, pp. 328-333; Ann Louise Strong, Factors Affecting Tenure on the Urban Fringe, Land-Use Controls Quarterly, Vol. 3, 1969, pp. 1-25; John Fraser Hart, Urban Encroachment on Rural Areas, Geographical Review, Vol. 66, 1976, pp. 1-17; Kathryn A. Zeimetz, Elizabeth Dillon, Ernest E. Hardy, and Robert C. Otte, Dynamics of Land Use in Fast Growth Areas, Economic Research Service Report No. 325 (Washington, D.C.: Government Printing Office, 1976); National Agricultural Lands Study, Final Report (Washington, D.C.: Government Printing Office, 1981), p. 96; Frank J. Popper, Why We Should Care about Who Owns the Land, American Land Forum Magazine, Vol. 2, 1981, pp. 1519; and H. James Brown, Robyn Swaim Phillips, and Neal A. Roberts, Land Markets at the Urban Fringe, Journal of American Planning Association, Vol. 47, 1981, pp. 131-144. 2 Robert G. Healy and James L. Short, The Market for Rural Land: Trends, Issues, Policies (Washington, D.C.: Conservation Foundation, 1981). * DR. PYLE completed this article when she was an assistant professor of geography at the University of Kentucky, Lexington, Kentucky 40506. This content downloaded from 157.55.39.147 on Sun, 07 Aug 2016 05:32:07 UTC All use subject to http://about.jstor.org/terms LAND MARKET BEYOND URBAN FRINGE rather than a productive good. Private buyers and sellers are not the only actors in the rural land market. The role of government must also be considered because landuse regulations imposed by authorities affect the decisions of individuals who participate in the land market.

Future Timberland Area: A Crucial but Illusive Variable in Timber Economy Models

Abstract Data on the acreage of timberland that will be available for harvest in the future are crucial to the development of accurate national and regional timber supply and demand models. Improved supply projections are needed for new timber economy models, but biologically realistic supply models require detailed data about the future timberland area base for large regions. No comprehensive research is being done to meet the requirements of the new models. A planned, complex approach should be developed whereby information on land influences, behavior of landowners, and economics can be obtained.

Amenity Forestry and the Economic Behaviour of Land Owners

Decisions made by landowners regarding amenity of forest land may be based on a complex behaviour rather than simply using a financial criterion. This behaviour does not necessarily fit into the economic models of multiple use based on perfect economic rationality. Studies of landowner attitudes and factors which affect decision making are an important part of forest economics research.

Landowner Behavior at the Rural-Urban Fringe in Response to Preferential Property Taxation

The factors influencing participation in both purchase of development rights and transfer of development rights farmland preservation programs are analyzed using data from a survey of agricultural landowners and from spatial data on individual farms ...

Predicting the Behavior of Predevelopment Landowners on the Urban Fringe

Abstract If the planner had a simple predictive technique to assess the likelihood that a parcel in nonurban use on the urban fringe would be sold during the next few years, he would be in a better position to anticipate the location of new urban fringe development. Such a model was developed from tests in two North Carolina cities, utilizing landowner and property information generally available in public records or in the planner's files. Utilizing data on how long the land had been held prior to the start of the study period, whether or not the owner lived on the land, whether or not the owner was retired, whether the ownership was single or joint, the assessed value of the land, and the amount of urban development surrounding the parcel, the model was able to classify from 60 to 80 percent of the sample parcels correctly as being “sold” or “held” over the 10-year test period.