Performance of Community Forest User Groups: Trade-Off between Current and Future Forest Produce (Empirical Evidence from Fuel Wood Model)

Abstract

"This paper addresses one of the unsettled and controversial issues in Community Forestry: How do the social choices/the political decision-making of the Community Forest User Group (CFUG) reflect its time preference or take care of the future of the Community Forest while deciding to withdraw forest produce for the current needs?

"It develops a choice-theoretic model and from it observes that a typical household is in equilibrium if the three conditions hold well. They are: i) marginal rate of time preference between the current and future consumption of forest produce equals the marginal rate of transformation between the current and future forest produce from group activity, ii) marginal rate of time preference between future consumption of forest produce and the current consumption of leisure time equals the marginal rate of transformation between the future forest produce and current expenditure of labour in group activity, and iii) marginal rate of substitution between the current consumption of produce from alternative activities and future consumption of forest produce from group activity equals the marginal productivity of expenditure out of the produce from alternative activities in monitoring of forest use. The household's preference for forest products for the current needs is reflected through the political decision making of the group. The negative coefficients of the CFUG's management activism and future consciousness in the equation for the three years' average quantity of fuel wood distributed in the current period validate our hypotheses that a high index of management activism and the future consciousness of the household about the protection of the forest for the future make a CFUG perform better in terms of the distribution of a smaller amount of fuel wood in the current period so as to preserve more fresh fuel wood for a better regeneration of the forest in the future. The negative value of the future consumption of fuel wood with respect to current consumption of fuel wood in the equation to Marginal Rate of Substitution (MRS) indicates an increase in the current consumption of fuel wood by a thousand kilograms reduces the consumption of the same in the future. The reduced-form coefficient of the management activism is positive and it indicates that an improvement in the overall weighted average index of management activism enables CFUGs to supply larger amount of fuel wood in the current year consistent with the long time preference of the households. The positive marginal value of the future consumption with respect to the current consumption of fuel wood in the equation to Marginal Rate of Transformation (MRT) implies a reduction in the consumption of fuel wood in the current year is transformed into a protected forest with fresh fuel wood in the future."