Title: Logging ban policy and its impact on international trade in forest products: the case of Thailand

Authors: Chindo Sulaiman; A.S. Abdul-rahim

Addresses: Faculty of Economics and Management, University Putra Malaysia, 43400 Serdang, Selangor, Malaysia; Department of Economics, Bauchi State University Gadau, Bauchi State, Nigeria ' Faculty of Economics and Management, University Putra Malaysia, 43400 Serdang, Selangor, Malaysia

Abstract: In 1989, unnecessary logging activities triggered huge landslides in Thailand that led to the loss of 373 human lives and properties worth millions of baht. Consequently, Thailand's authorities officially imposed a logging ban to forestall the future reoccurrence of a similar disaster. Using a J-curve hypothesis, this paper examined the impact of the logging ban on Thailand's forest product trade balances. To achieve the objective, an autoregressive distributed lag approach to cointegration was applied to estimate the results using data from 1971 to 2010. The results revealed that the policy has had a negative effect on product trade balances in the short-run and the long-run. In addition, domestic income, foreign income and the exchange rate were found to significantly influence product trade balance variations. The J-curve effect was non-existent for all of the sampled products. As such, policies that will both safeguard the environment and ensure economic growth are recommended.

Keywords: trade balance; logging ban; J-curve hypothesis; ARDL approach; trade impact; international trade; forest products; Thailand; landslides; economic growth; domestic income; foreign income; exchange rates.

DOI: 10.1504/IJGE.2015.075195

International Journal of Green Economics, 2015 Vol.9 No.3/4, pp.242 - 257

Available online: 07 Mar 2016 *

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