Productivity and Technology Adoption in the Alberta Forest Sector

• Author / Creator

  Wang, Shuo

• The competitiveness of the Canadian forest sector is facing threats from multiple directions including supply constraints due to the Mountain Pine Beetle devastation and unusually high fire losses. Consequently, the need to improve the productivity of the forest sector is paramount to maintaining global competitiveness. The adoption of genomic technology and the use of improved seeds are expected to improve timber productivity in the near future. However, this improvement will need to take place within the confines of the public-private nature of the sector where 93% of the total forest area is publicly owned.

  Stringent government regulations can hinder competitiveness by imposing a cost on production. To gain some insights into the extent to which stringent forest regulatory policies
  have slowed down technical change and negatively affected productivity in the forest sector, I investigate the production structure of the Alberta logging industry. Specifically, I examine the nature of factor substitution and estimate the rate of technical change and total factor productivity growth. A key finding is that both the rate of technical change and total factor productivity growth are negative in most years in my sample. I also find low elasticities of substitution between inputs and that technical change has been material-neutral.
  Government policy can also reduce the incentives for firms to adopt new technologies by increasing uncertainties and limiting the benefit of new technologies. To explore the extent
  to which government policies can affect the welfare outcomes of adopting a productivity-enhancing technology, I calculate the economic returns to the adoption of genomics-assisted
  tree breeding (GATB) in Alberta under different breeding and policy scenarios. I find that the payoffs of GATB research are large. However, the results also demonstrate that when
  the level of genetic gain approved by the government is low, the economic returns can be negative and therefore discourage the adoption of genomic technology.

  This study provides some evidence that Alberta’s regulations have reduced incentives for forest companies to improve its overall productivity. These findings have important policy
  and investment implications to the government and forest companies in Alberta.

• Subjects / Keywords

  • regulation
  • forest
  • genomic technology
  • productivity

• Graduation date

  Fall 2018

• Type of Item

  Thesis

• Degree

  Master of Science

• DOI

  https://doi.org/10.7939/R3PV6BP6Z

• License

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