Forest Economist
Multi-stakeholder Forestry Programme (MFP)
Block VII, Floor 6
Manggala Wanabakti Building
Jl. Jend. Gatot Subroto
Jakarta 10270
Indonesia
Office telephone: 62 [0]21 571 1194
Office fax: 62 [0]21 572 0215
email: davidwbrown@attglobal.net
Dr. David Brown is a research professional with more than a decade of experience analyzing emerging markets, natural resource industries, and politico-military affairs. For much of the last eight years, he has worked as a consultant to UK Department for International Development forestry projects in Indonesia, most recently its Multi-Stakeholder Forestry Programme.
Dr. Brown’s current work consists of helping independent assessors audit large forest mills. Brown’s job is to create, and obtain multi-stakeholder approval for, guidelines that enable independent investigators to collect physical evidence of mills that use or harbor illegal logs.
Prior to his work for the UK government, Brown worked as a Equities Analyst for the German-UK global investment bank Dresdner Kleinwort Benson, on whose behalf he wrote investment recommendations on Indonesia’s largest publicly traded plywood, oil palm, and pulp and paper companies.
While in Indonesia, Brown also worked as a consultant to the World Bank, leading an all-Indonesian team to monitor illegal logging on a timber concession adjacent to a national park, and to the Nature Conservancy, identifying Indonesian natural forest timber concessions with the highest conservation potential.
He was awarded a Fulbright grant in Malaysia, where he served as a Visiting Research Fellow at the Institute for Strategic & International Studies (ISIS), and a Social Science Research Council International Predissertation Fellowship in Indonesia, where he served as a Visiting Scholar at the Faculty of Economics, University of Indonesia.
Prior to his graduate studies, Brown had a six year career in Washington, DC, working alternately as an advisor on military, foreign relations, energy, and environmental matters to US Senator Max Baucus of Montana and US Congressman Wayne Owens of Utah, and as a Research Associate with the Democratic Senatorial Campaign Committee. Brown was a Telluride Scholar at Cornell University, where he was awarded a Bachelors degree in Political Economy.
June 2001
The dissertation starts from the assumption that natural resources are easy for governments to tax, as they embody high amounts of windfall profit or "economic rent." According to resource economics, it is optimal for governments to collect as revenues nearly all of the economic rent earned by resource extractors. However, the actual level at which governments collect economic rent from rain forest timber is generally quite small.
The study argues that government agencies fail to collect timber rent at optimum levels because they are prevented from doing so by rulers who use their positions to build and maintain hidden ties to the timber industry through which they appropriate vast amounts of timber rent.
Proving that rulers are appropriating timber rent is accomplished through archival research, primary documents, and five years of fieldwork to identify all forest areas licensed to the largest timber conglomerates in Indonesia, Sarawak and Sabah. This research is corroborated and supplemented through structured interviews to find out whether rulers, their families, proxies, business partners, and political supporters and financiers run or own these timber concessions.
The study concludes that in Indonesia, Sarawak, and Sabah each head of state has multiple ties to timber concessions. The dissertation estimates that the three governments failed to collect 40 billion dollars in timber revenues over thirty years.
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Cover Page, Abstract - Intro Pages (Word97) - 96kb
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Implications for Forest Sustainability and Government Policy
7 September 1999
"Addicted to Rent" starts from the important but often misunderstood concept of economic rent, or above normal profit. The report argues that in spite of the efforts of many, timber policy reform in Indonesia continues to fail because governments past and present view the timber resources as something from which they can informally capture economic rent, and use it for political and personal objectives, rather than to achieve national development objectives. more...
Download the whole report:
- Intro pages (Word97) - (106kb)
Executive Summary, Acknowledgements, Glossary, Table of Contents - Main Report (Word97) (525kb)