Forest Property Rights Enforcement in Lao PDR: A Steady State Analysis Using Genetic Algorithms

A major cause of deforestation in Lao PDR is associated with commercial timber harvesting. While there exists a legal timber industry, timber harvesting in Laos is often illegal. Little information is available regarding the illegal Lao timber industry. However, it would appear that both illegal and legal timber harvesting is often carried out by the same agents. This paper analyses government forestry property rights enforcement and logging by a commercial contract logger who is assumed to log not only quota levels, but also additional quantities of illegally harvested timber. The model is analyses as a two-player difference game played over infinite time. The game is hard to solve analytically, therefore a genetic algorithm is used to approximate numerical steady states. Results from the model indicate that more efficient forest property rights enforcement, improved contract tenure security and a greater flow of any monetary penalties (or bribes) to the central government will all act to increase the steady state level of forest stock in Laos.