Wood is a natural, biodegradable product. It can be used in many ways and the material itself is also flexible - steaming and lamination can be used to bend wood. Wood is generally divided into 3 categories:
For more information on wood and its lifecycle, see Explain That Stuff: Wood.
Paper has been in use since Egyptians first made paper with papyrus in roughly 3000 B.C.E. It is created by breaking down a plant (nowadays, typically trees) to release fibers that are mixed with water to create a pulp and then dried.
Lower-grades of manufactured paper are made using what is called the "groundwood process" - originally, this involved using huge stones to grind up logs but now machines are used. The Kraft process is used to create strong paper by boiling plant materials in alkalis.
For more information on the history of paper and its creation, see Explain That Stuff: Paper.