Due to the current crisis on global warming and species extinction, scientists and economists have proposed to quantify ecosystem goods and services to establish policies that can preserve the ecosystem, provide better livelihood to the local stakeholders, and benefit society. The overarching question for this dissertation study is, ``How to quantify the trade-offs between carbon sequestration, total timber harvested, and habitat provision for sustaining biodiversity?'' In particular, when i. different management regimes; ii. carbon prices; and iii. natural disturbances; interact with each other. The first step is to develop a model that quantifies the relationship between forest management activities and the amount of timber harvested annually. To provide a general understanding of the relationship, the study area for the first step is at the county level for the whole state of North Carolina. The following 2 steps involve more specific studies to include the interaction between management activities, natural disturbances, species competition during the forest succession process. Therefore, a species-rich, heterogeneous area with an active timber industry, located in western part of North Carolina, the Grandfather Ranger District was chosen. The second step is to quantify the outcomes and analyze the trade-offs between the ecosystem services under different management scenarios, coupled with the influences from natural disturbance. The third step combines the result from the second step with different carbon prices and interest rates to obtain a fine scale and spatial analysis of the resulting revenue.

The dissertation is the first step of research in developing a dynamic model that fully couples the social and forest ecological system.

Besides the potential uses for fulfilling the requirements of carbon accounting, the result from the first step of the dissertation is the maps of annual volume of harvested timber of various types. The maps can be used to further study to analyze the relationship between the amount of timber harvested as a result of different policies and prices at different places. The second step demonstrated a way to quantify the trade-offs between the selected ecosystem services under different forest management regimes and influences from natural disturbances events. Maps of revenue from both selling the carbon credit and harvested timber for scenarios of different carbon prices and interest rates were produced in the last step. The choice of future timber production as a result of carbon and roundwood prices can partly be understood by utilizing the maps from the first step in this dissertation. If the factors affect individual choices of harvest at the local level and those affect the supply of harvested timber at the regional level are understood, then a dynamic model that consists of management decisions, natural disturbance, ecosystem service valuation policies, and forest ecosystem response can be developed. Such model can help better understand the ecosystem services valuation policy on the financial well-being of foresters and the health of the forest ecosystem.