We think beyond the Pigouvian policy approach for correcting forest ecosystem externalities. Not all ecosystem services in forestry are public goods and deserving of government intervention. Interaction in the market by sellers and buyers concerning payments for ecosystem services is possible....

This article examines alternative forest harvesting regimes when ecosystem services in terms of water quality, biodiversity conservation and climate change mitigation are included in the analysis. The harvesting regimes are whole-tree harvesting with stump removal and conventional stem-only...

We examine the optimal length of a contract period in a conservation program with payments for ecosystem services aiming at protecting biodiversity on privately owned forests. The government chooses the number of stands and the length of contracts so as to maximize biodiversity benefits under a...