Overview: 

This model displays the conflict between the tourism and timber industry in Derby, Tasmania. It becomes a problem for the government officials when choosing the future policy direction. Our aim is to construct a model for simulation and find a equilibrium point to maximize the state benefit.

How Does the Model Work?

The key factor of the model is the value of the policy variable. It can take values between -1 and +1. The more it is close to +1 means that the policy government takes is more tourism-friendly. The more it is close to -1 means that the policy government takes is more timber-friendly.

Other than the policy variable, there are three sections for the model.

Section 1: The tourism

       We assume that there exist a population which contains the whole potential customers. The potential customers will make bike trips to Derby at a relatively stable rate. The input policy value will affect the satisfaction rate for the tourists. Some of them will provide positive feedbacks and become our potential customers again. On the other hand, those had bad experience will no longer make trips to Derby. All the tourists make consumption every month and part of the expense will become the tourism revenue. The average expense variable is also provided in this section.

Section 2: The timber industry

      The input policy variable will also affect the employment in the timber industry. It will partially determine the industry growth rate. Like the tourism, the sales/industry scale will generate monthly revenue for the industry at a given rate.

Section 3: The state benefit

      The revenue from the two industries will be added up. Our aim is to adjust the policy value to maximize the state benefit.

       Excessive logging may lead to environmental problems and it isn’t the best option for the whole state benefit. Based on the pre-set parameters and the model, we can see that the revenue contribution from the tourism is also considerable. According to our results, the policy value should be around 0.31, which represents the tourism-friendly policy.

This model demonstrates the intertwining relationship between the economic contribution of industrial logging and that of adventure tourism (dominated by mountain biking).

In terms of the revenue from industrial logging at Derby, it is driven by demand of timber and the timber price. However, the forest resources are limited, which will put constraints on the expansion of industrial logging due to regrowth rate and existing forestation.

The tourism can bring economic benefits to Derby from hospitality and selling tickets to local adventure activities. The hospitality income can be determined by the average length of holidaying at Derby and average local pricing for accommodation, food and beverages and related essentials. Tickets sales are largely affected by the similar factors such as average expense per activity and average number of activities that tourists usually choose. Having explained the streams of possible income from the tourism, the key driver for tourism income is the desire or demand to travel. Unlikely logging, tourism is renewable and perpetual. However, logging can be conceived as a major constraint on attracting as many tourists as the economy so desires.

This is because deforestation caused by logging will diminish the natural scenery at Derby and in turn, the tourist operations and attractions based upon natural scenery. Loss of forest resources is likely to make Derby less attractive to visitors.

In short, the tourism and logging both provides economic benefits to Derby but in a competing relationship. However, the sustainability possessed by tourism cannot be rivaled by industrial logging in long term. Logging revenue reveals its advantage at inception of observed time period. Such advantage wears out over the time due to reduction in resources and sluggish regrowth. Eventually. the tourism income turns into the major player. To understand how they co-exist, please simulate the model. 

Overview

A model which simulates the competition between logging versus adventure tourism (mountain bike ridding) in Derby Tasmania. 

How the model works:

Trees grow, and we cut them down because of the demand for Timber and sell the logs. Mountain bikers and holiday visitors will come to the park and this depends on experience and recommendations.  Past experience and recommendations depend on the Scenery, number of trees compared to the visitor and Adventure number of trees and users.  Park capacity limits the number of users.  To utilize highest park capacity, they need to promote to the holiday visitor segment as well. Again, the visit depends on the scenery. So, both mountain biking and forestry (logging) businesses need to contribute a significant amount of revenue to CSR for faster regrowth of trees.

Interesting insights

It looks like a lot of logging doesn't stop people from mountain biking. 

Faster replantation of the tree will balance out the impact created by logging which will give the visitor a positive experience and the number of visitors is both improved. 

To keep the park's popularity in check, the price of wood needs to be high. 

Also, it looks like mountain biking only needs a narrow path.

CSR contribution to nature can be a crucial factor.