Bequest Intentions of Forest Landowners: Theory and Empirical Evidence*

This paper studies in an overlapping generations forest economy the conditions under which money and/or timber bequests occur across generations, assuming the usual case of one-sided altruism. We assume nonindustrial landowners have preferences for consumption and for amenities from unharvested forest stock. Within this framework, we examine conditions under which landowners choose to leave timber or money bequests, and we show how taxation is important to these conditions. Empirical evidence from bequests decisions for a cross section sample of nonindustrial landowners in Virginia is then used to investigate the hypotheses suggested by the model with regard to the motive to leave bequests. The results are broadly consistent with the theoretical findings.