Abstract: This paper studies the short-run environmental effects of China's import on primary timber products, and the long-run effects may be brought by import. It indicates that in short run, import attributes to the alleviation of negative externality in timber products sector, but import may have negative economic incentive on the cultivation of forest resources in long run, thus there may be divergence between short-run and long-run effects. Further analysis points out that the establishment of effective institutional incentive is helpful to offset the potential negative effects of import.

Key words: environmental effects, timber import, negative externality, economic incentive