Production efficiency of community forestry in Nepal : a stochastic frontier analysis

Abstract

During the past three decades, 1.2 million hectares of Nepal’s forests have been transferred to community management with the twin objectives of supplying forest products and addressing local environmental problems. Community forests provide a range of benefits, from direct forest products such as timber, fuelwood, fodder, litter and grasses to ecosystem services such as soil protection and wildlife conservation. However, there is limited information on the relationship between the environmental and the community welfare effects of entrusting forests to communities. This study has analysed the production of natural environmental and direct forest product benefits in CFs, and identified the relationships between the outputs. Community Forest User Groups were surveyed to measure the flow of products from their community forests. Environmental benefits were measured using a novel application of the Analytic Network Process (ANP). The ANP is generally executed by taking expert opinions; however, this study has taken forest user member’s opinions. The stochastic frontier production analysis indicated that the production of direct forest product benefits per hectare was influenced by various socioeconomic and forest related factors, most prominently forest size, group heterogeneity, forest product dependency, size of community and links to the market. In addition, forest product benefits and environmental benefits were complementary to each other. Likewise, the production efficiency analysis showed that communities were not producing forest products efficiently. It also showed that factors such as social capital, support from the government and the longevity of CF management, contributed positively to the production efficiency, whereas caste heterogeneity in the executive committees of community forest user groups was negatively associated. It is anticipated that these findings will contribute to better implementation of community forestry programmes in Nepal and consequently will improve the welfare of communities by increasing direct forest product benefits and environmental benefits.