Are Agricultural Values a Reliable Guide in Determining Landowners’ Decisions to Create Carbon Forest Sinks?

This research examines the effects of various factors on farmer participation in agricultural tree plantations for economic, environmental, social and carbon-uptake purposes, and potential costs of sequestering carbon through afforestation in western Canada. Using data from a survey of landowners, a discrete choice random utility model is used to determine the probability of landowners’ participation and corresponding mean willingness to accept (WTA) compensation for a tree-planting program. WTA includes positive and negative benefits to landowners from planting trees, benefits not captured by foregone returns from agricultural activities on marginal land. Estimates of WTA are less than foregone returns, but even so average costs of creating carbon credits still exceed their projected value under a CO2-emissions trading scheme.

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Working or Discussion Paper
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JEL Codes:
Q15; Q23; Q54
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REPA Working Paper

 Record created 2017-04-01, last modified 2020-10-28

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