The effects of subsidized regeneration measures on timber supply,once again

Using an econometric model of the sawtimber and pulpwood market in price region 1 (the northern part of Sweden), it is considered whether the subsidies paid to regeneration costs in this region have had any measurable effect on short‐run wood supply. The analysis is a continuation of the work presented by Brännlund et al. (1985 b), in which it was claimed that subsidies have had a non‐positive effect on short‐run supply. A more elaborated test is used in this study. The test is based on the use of a reference model which, in this case, consists of an econometric model for the whole country of Sweden. The results from the test cannot be used to reject the conclusion that subsidies have had a non‐positive effect on short‐run wood supply.