200 jobs compared to the same shock with unemployment compensation. The additional loss in
service sector jobs is about 1 percent of service sector jobs base.
Comparison with Fixed Price Model Results
A standard input-output model was subjected to same log shocks as the CGE model under
the assumption of no unemployment transfers in each model.11 As expected, the estimated
employment and income losses are greater for the IO model than the CGE model. For a 50
percent reduction in federal log supply, the IO total employment impacts are roughly 64 percent
greater than the CGE impacts (Table 5). As the supply reduction becomes more severe the CGE
results begin to approach the IO results. For example, for an 80 percent federal log supply
reduction, the IO employment impacts are roughly 36 percent greater than the CGE employment
impacts.
Turning to household income impacts, considerable differences between the between IO
and CGE impact estimates were also observed. For a 50 percent reduction in federal log supply,
the loss in regional household income is 68 percent greater in the IO model results than the CGE
model (Table 6). For the 80 percent log shock the IO model results are roughly 40 percent
greater than CGE results (Table 6).
The Impacts of National Price Effects
Assuming that the reduction in access to federal timber supplies is played out not just in
Northeast Oregon but throughout the entire West; then it becomes appropriate to consider log
and wood product price effects at the national level. Logs from federal lands account for less
than 20 percent of national soft wood log supply (Adams, 1999). Even in the case of a moderate
11In the fixed-price model used for this study, household incomes and household
consumption expenditures are also assumed endogenous. Such a model is referred to as a Type II
input-output model.
13