Changes in the 1991 NDS to dimension lumber design values are based on a comprehensive testing program conducted by the North American forest products industry called In-Grade Testing. Here’s an excerpt from section 4.2.3.2 of the NDS Commentary:

“The testing program conducted over an eight year period, involved the destructive testing of 70,000 pieces of lumber from 33 species groups. A new test method standard, ASTM D4761, was developed to cover the mechanical test methods used in the program. A new standard practice, ASTM D1990, was developed to codify procedures for establishing design values for visually graded dimension lumber from test results obtained from in-grade test programs.”

There are also a couple of 5-6 page articles on the subject:

“Lumber Design Values from In-Grade Test Results,” Wood Design Focus, Volume 2, No. 2, 1991, Forest Products Society.
“In-Grade: What it means,” Western Wood Products Association, Rev. 12-94.

In addition to these references, the Wood Handbook (Chapter 7), published by the Forest Products Lab, deals with lumber stress grades and derivation of design properties. It gives a good overview of the development of “small-clear” design values and “in-grade.” It also provides some additional references for further study.

Link to Chapter 7 on the FPL website

Note that concurrent with development of new design values in the 1991 NDS, behavioral equations for column, beam, and beam-column design also changed as a result of the In-Grade Testing program. Therefore, an advisory was issued with the 1991 NDS indicating that new design values were to be used simultaneously with new design equations and pre-1991 design values be used with pre-1991 design equations.