Knock on wood - The relationship between macro variables and forest land return in Sweden 1996-2020

Abstract

This thesis examines if three commonly used regions in Sweden differ in yearly forest yield over the period 1996-2020. An expression defining yearly forest yield is constructed and evaluated, together with macro economy determinants in a panel data model, using Random effects. The main findings describe how the SEK/USD exchange rate potentially has a negative effect on yearly forest yield, yet no large differences can be established between the three regions. This thesis concludes that the Swedish Central Bank’s short-term interest rate has no significant influence over yearly forest yield, contrary to previous studies on forest estate market price. We also find that both Exporting price index and GDP growth have a significant effect.