| Summary: | Spotted Owl litigation has led to substantial fluctuations in Pacific Northwest public timber availability from 1987 to the present. A theoretical and two distinct empirical models using monthly data are developed to understand and test the potential of this litigation to affect the national market for lumber. The results of an econometric framework indicate that Northwest public timber fluctuations have affected the Northwest lumber industry, but provide no evidence that the effects are felt in other regions of the United States. A time-series approach indicates that the Northwest lumber market is affected by these timber fluctuations, and that regional lumber markets are interdependent, but again, there is no direct evidence that Northwest public timber fluctuations have affected the lumber markets of other regions. Using each of these empirical frameworks, intervention analysis is performed to test the significance of individual litigation events on regional lumber markets. Econometric-model intervention results provide no evidence to suggest that individual litigation events have influenced these markets, but time-series intervention results suggest that lumber prices may have been influenced by some of the litigation in question.
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