ABSTRACT
This chapter discusses the links between the timber trade and tropical deforestation. It focuses on the role of the timber trade as an incentive for sustainable tropical forest management, which involves looking at alternative tropical forest land use options and the economics of land allocation. The chapter draws together the literature on the direct and indirect links between timber production and tropical deforestation. In addition to depleting wood resources, timber extraction can incur external environmental costs by degrading other tropical forest resources and functions which are of value to individuals other than timber operators. A number of studies have attempted to assess the relative importance of various economic activities, including timber extraction, in causing tropical deforestation. The timber trade can lead to greater net returns for forestry investments, and make sustained timber management as a prerequisite for stabilization of forest areas in the tropics more feasible in the long run.
