Table 6--Southwide acreage of tree planting en- 
rolled under Conservation Reserve Program (to 
March 1987) 
Signup periods 
1986 
First 
Second 
Third 
1987 
First 
These acreages represent about 95 percent of 
all tree planting under the Conservation Reserve 
Program, which has a 5-year goal of approximately 
5 million acres of tree planting. Table 6 profiles the 
enrollment for tree planting for the first four signup 
periods. 
The Southwide data on use of public forestry 
incentives reflect program accomplishments, but 
they do not answer this question: To what extent, if 
any, do the incentive programs stimulate invest- 
ment, other factors being equal? That is, to what 
extent can we attribute any of the recent increases 
in tree planting in the South to public financial incen- 
tives as opposed to changes in markets, owner, and 
ownership characteristics? The array of possible 
determinants of reforestation behavior has recently 
drawn the attention of econometricians and empiri- 
cal studies of landowner investment behavior are 
beginning to emerge. A review of the findings of 
these studies serves here as a means to judge our 
progress toward isolating the effects of public pro- 
grams on landowner decisions. 
Empirical Studies of Forestry Investment 
Behavior 
To understand the significance of recent econo- 
metric models of forestry investment behavior, read- 
ers will need a brief review of landowner research. 
Empirical surveys of landowner behavior since the 
80 
Thousand acres 
124 
183 
253 
519 
1940's are numerous, but the overwhelming major- 
ity of these surveys simply profiles the characteris- 
tics of landowners. Rarely are the surveys based on 
theoretical models, and rarely do they explore the 
simultaneous effects of a full array of market, policy, 
owner, or ownership influences. Those studies that 
include some analysis of behavior typically explore 
only bivariate interactions, such as a correlation or 
test of dependence between two variables. The liter- 
ature on landowner behavior is thus extensive but 
inadequate for understanding and _ predicting 
landowner behavior. 
Recently, debate over the relative importance of 
market and policy effects has led to the develop- 
ment and estimation of more fully specified econo- 
metric models of landowner behavior. These efforts 
use multiple regression techniques to model one of 
two landowner decisions: (1) the decision to harvest 
timber, which determines short-term timber supply; 
or (2) the decision to invest in forest management, 
most often reforestation after harvest, which deter- 
mines long-term timber supply. The distinction 
between these two categories is important because 
the decision to harvest can be made separately 
from the decision to invest, even though the two 
may be dependent. Hence, the harvesting choice 
can have determinants that are different from those 
of the investment choice. 
The review in this paper focuses primarily on 
investment models because of their rigorous exami- 
nation of public financial incentives and the central 
importance of regeneration after harvest (the invest- 
