A HOUSEHOLD PRODUCTION ANALYSIS OF FUELWOOD DEMAND IN RHODE ISLAND
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A model analyzing household substitution of fuelwood for other heating fuels is needed to clarify the relationship between energy prices and patterns of forest resource utilization. This paper employs the household production methodology to model fuelwood demand in Rhode Island. Data from a cross-sectional survey of 515 households are employed to test a discrete-choice model of household participation in wood-burning and a four-equation system modeling household production of heat and aesthetic benefits from fuelwood and stove capital. Control of selection bias via inclusion of an appropriate instrument allows analysis of aggregate demands. Some broad policy prescriptions applicable to the Northeast generally are presented.