Poverty and Employment in Forest-Dependent Counties

Abstract

One of the most controversial aspects of federal and state policies aimed at protecting old-growth ecosystems is the potential effect of job losses on local economic conditions. A fundamental question for historically forest-dependent areas is whether these policies will result in local economic stagnation and enduring pockets of poverty. This study uses monthly, multicounty time series data to estimate a vector autoregressive model of the experience of northern California counties during the 1980s and 1990s. It examines the long-run impact of changes in timber-related employment on other employment and participation in major federal poverty programs. It finds that employment base-multiplier effects of timber employment on other county employment are small and state economic conditions rather than local employment conditions are the principal driver behind local poverty.

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