Designing afforestation subsidies that account for the benefits of carbon sequestration: A case study using data from China's Loess Plateau

This paper presents a method for determining the subsidy required to motivate farmers to participate in timber afforestation programs designed to maximize social well-being. The method incorporates a carbon sequestration benefit function into the land expected value model in order to quantify the social benefit arising from carbon sequestration by the planted trees. This is used to calculate the optimal rotation age for newly planted forests that maximizes social utility. The minimum subsidy required to motivate farmers to participate in the afforestation program was calculated using a modified decision model that accounts for the subsidy's impact. The maximum subsidy offered by the government was taken to be the NPV of the carbon sequestration achieved by afforestation. Data on Robinia pseudoacacia L. trees planted on the Loess Plateau were used in an empirical test of the model, which in this case predicts an optimal subsidy of 254.38 yuan/ha over 40 years. This would guarantee the maintenance of forest on land designated for afforestation until they reached the socially optimal rotation age. The method presented herein offers a new framework for designing afforestation subsidy programs that account for the environmental service (specially, the carbon sequestration) provided by forests.     

Effects of resin tapping on optimal rotation age of pine plantation

This paper analyses the effects of resin benefit on the optimal rotation age of Simao pine plantation. Timber growth and resin yield functions were first derived, and then an integrated formulation for Hartman rotation was solved by taking both timber and resin benefits into consideration through numerical optimization. Empirical results indicate that: (1) the inclusion of resin benefit results in lengthening optimal rotation age; (2) resin benefit has a greater effect on rotation age when discount rate is low than when it is high, ceteris paribus; (3) with an improvement of site productivity, resin benefit has a decreasing effect on rotation age, other factors being constant. These effects are also true with respect to benefit gains in present value.     

Determining optimal forest rotation ages and carbon offset credits: Accounting for post-harvest carbon storehouses

Sequestering carbon in forest ecosystems is important for mitigating climate change. A major policy concern is whether forests should be left unharvested to avoid carbon dioxide (CO₂) emissions and store carbon, or harvested to take advantage of potential carbon storage in post-harvest wood product sinks and removal of CO₂ from the atmosphere by new growth. The issue is addressed in this paper by examining carbon rotation ages that consider commercial timber as well as carbon values. A discrete-time optimal rotation age model is developed that employs data on carbon fluxes stored in both living and dead biomass as opposed to carbon as a function of timber growth. Carbon is allocated to several ecosystem and post-harvest product pools that decay over time at different rates. In addition, the timing of carbon fluxes is taken into account by weighting future carbon fluxes as less important than current ones. Using simple formulae for determining optimal rotation ages, we find that: (1) Reducing the price of timber while increasing the price of carbon will increase rotation age, perhaps to infinity (stand remains unharvested). (2) An increase in the rate used to discount physical carbon generally reduces the rotation age, but not in all cases. (3) As a corollary, an increase in the price of carbon increases or reduces rotation age depending on the weight chosen to discount future carbon fluxes. (4) Site characteristics and the mix of species on the site affect conclusions (2) and (3). (5) A large variety of carbon offset credits from forestry activities could be justified, which makes it difficult to accept any.     

Valuing habitat regime models for the red-cockaded woodpecker in Mississippi

Managing Mississippi's forest lands to produce both quality wildlife habitat as well as merchantable timber can be a daunting challenge for forest managers and a source of great concern for the public. In some cases, producing both the quantity and quality of habitat needed and the timber desired is all but impossible. In other cases, a delicate balance that achieves both objectives can be struck. The objective of this study was to quantitatively estimate monetary gains and losses and changes in timber inventories relative to the timber growing stock when producing more or less habitat for the red-cockaded woodpecker (RCW) (Picoides borealis). USDA Forest Service vegetation data, habitat ratings, and economic variables were compiled for those regions of Mississippi best suited for RCWs. Data was then analyzed with Spectrum, the USDA Forest Service-based forest planning software. Models maximizing such objectives as net present value (NPV) alone as well as five different levels of RCW habitat quality over a 50-year rotation were developed. Revenue foregone, acres and volumes harvested, land expectation value (LEV), and equivalent annual income (EAI) were compared for all objectives for the South Central Hills and Pine Belt regions of Mississippi (1,036,208 acres) for three ownership types. As expected, when maximizing for any quality level of RCW habitat, revenue forgone was higher ($0.11–$49/acre/year) than for NPV alone. Volume harvested for high-quality habitat ranged from 152,296 to 10,237,649 cunits, while harvests from low-quality habitat ranged from 637,491 to 116,357,673 cunits. Lower levels of habitat management allowed for an increased emphasis on timber harvesting. In general, we determined that increases in habitat quality resulted in lower timber harvest levels and increased revenue forgone than regimes maximizing NPVs. While this result may be expected, of greater importance are the relative differences between regimes and the ability to use these values for policy decisions.     

The multiple effects of carbon values on optimal rotation

Non-consumptive benefits which increase with crop age, like keeping carbon sequestered, lengthen optimal rotation compared with rotation for timber alone. High proposed carbon prices may extend rotation indefinitely. Carbon storage in wood products reduces this tendency. Biomass as an energy source displacing fossil fuels favours rotations near those of maximum biomass productivity. Use of sawn timber to displace structural materials with high embodied carbon favours somewhat longer rotations. Effects of rotation on soil carbon, and fossil carbon volatilised in harvesting operations, are further complications. Including all carbon effects results in optimal rotations somewhat longer than those based only on timber value, but shorter than those based on timber plus forest carbon. To include all factors intuitively is not possible: balanced appraisal needs economic calculations.     

Review - Roger A. Sedjo (2003): Economics of Forestry

Ashgate Publishing Limited, Gower House, Croft Road, Aldershot, Hants GU11 3HR, England (www.ashgate.com). 498 p. £ 100.00. ISBN 0-7546-2237-1 (hardback).Being one volume in the series of the International Library of Environmental Economics and Policy (T. Tietenberg and W. Morrison, gen. eds.), this book is a collection of some of the most significant journal essays in forest economics and forest policy. In compiling this volume, Roger Sedjo did a great service to the forest economics profession.This volume includes twenty-five essays originally published between 1849 and 1996 in a dozen journals, and one chapter from the Third Assessment Report of the International Panel on Climate Change (IPCC, 2001) which addresses the biological sequestration of carbon in terrestrial ecosystems. These are organized into four parts: the harvest rotation issue, timber supply, multiple-use and non-timber outputs, and global issues. An introduction essay to this volume, written by the editor, provides an overview of the major issues in forest resource management and discusses some the most important contributions to the forest economics literature.The eleven essays in the first part of the book provide a rather complete coverage of the most important contributions to the literature on optimal rotation age, which is a fundamental issue in forest management and forestry investment. Four of the essays (Faustmann 1849, Ohlin 1921, Bentley and Teeguarden 1965, and Samuelson 1976) address the basic formulation and interpretation of the optimal rotation model. Four essays (Löfgren 1985, Newman, Gilbert and Hyde 1985, Reed 1984, and Brazee and Mendelsohn 1988) extend the basic rotation model to examine the rotation age decision in the presence of deterministic trends and uncertainty in timber yield and price, respectively. Based on the Faustamnn rotation model, Klemperer (1976) and Chang (1982) examine the impacts of taxation on forest value and on the optimal rotation age. Koskela (1989) provides a detailed analysis of the impacts of taxation on timber harvest decisions under price uncertainty. What I feel missing in this part is a comparative statics analysis examining the impacts of changing economic parameters on the optimal rotation age.Part II includes five essays on economic analysis of long-run timber supply. Clawson (1979) reviews the historical development of forest resource and forest utilization in the United States. Vaux (1973) examines the long-run potential supply of timber from forest plantations in California. Berck (1979) investigates the difference in harvesting behavior between private forest owners and public managers. Lyon (1981) and Lyon and Sedjo (1983) examine the optimal exploitation of old-growth natural forests and the transition to steady state. While these essays all focus on the long-run timber supply in the United States, the methods developed and used in these papers could be applied for any other region. The exploitation of old-growth natural forests and the long-term availability of timber have been without doubt two major concerns in the United States. In many parts of the world, however, concerns about timber supply in the short-run have also had great influences on the development of forest policy. It would have been appreciated if a couple of essays addressing the short-run supply of timber had been included.Part III contains three essays dealing with the problem of multiple-use forest management. Gregory (1955) develops an economic framework for multiple-use management based joint production theory. Hartman (1976) examines the multiple-use rotation age decision. Swallow, Parks and Wear (1990) investigate the problem of non-convexities involved in multiple-use rotation age decisions. The merits of these essays lie in that they use rather simple models to demonstrate the importance of incorporating non-timber benefits in forestry decisions and the complexities of the multiple-use problem. In his 1976 essay, Hartman points out that in many situations management practices applied to one stand affect the value of non-timber outputs derived from the adjacent stands; such interdependence needs to be incorporated into multiple-use decision analysis. I certainly would like to find in this volume one or two essays examining the impacts of stand interdependence on the optimal decision. Another important issue in multiple-use management, which is not covered in this volume either, is the valuation of non-market priced outputs and services. Yet I believe that this omission is well motivated, for there are two separate volumes in this series devoted to non-market valuation methods (R. T. Carson, ed. Direct Environmental Valuation Methods, Volumes I and II).The seven essays in Part IV deal with a set of forest economic and policy issues related to global warming and biodiversity conservation. Parks and Hardie (1995) examine the cost-effective subsidies to convert marginal agricultural land to forests for the purpose of carbon sequestration. Hoen and Solberg (1993) analyze the potential and cost-effectiveness of increasing carbon sequestration in existing forests by changing forestry practices. van Kooten, Binkley and Delcourt (1995) examine the effect of carbon taxes and subsidies on the optimal rotation age. The chapter from the Third Assessment Report of IPCC (2001) provides a comprehensive review of the literature on the ecological, environmental, social and economic aspects of carbon sequestration in terrestrial ecosystems. While forests and forest management could play an important role in mitigating climate change, increasing level of atmospheric dioxide and climate change would inevitably affect the productivity of forest ecosystems, thereby could have significant impacts on future timber growth, harvest and inventory as well as carbon storage in forest ecosystems. Joyce et al. (1995) present a framework for analyzing the potential effects of climate change on the forest sector. The remaining two essays in this part examine the costs and benefits of biodiversity preservation, respectively. Montgomery, Brown and Adams (1994) estimate the marginal cost of preserving the northern spotted owl. Simpson, Sedjo and Reid (1996) examine the expected value of the marginal species as an input to pharmaceuticals.The editor points out in the introduction chapter that there are many other important contributions that are not included in this volume, some of these are mentioned, others not. In addition to the few omissions noted earlier, several important economic and policy issues such as uneven-aged stand management, deforestation, international trade, sustainable forestry, forest recreation, wildlife management and so on are not discussed. Moreover, none of the journal essays published since 1997 is selected. That there are many other important contributions does not mean the essays included in this volume are less important, however. While each forest economist may present a different list of the most important papers, most (if not all) of the essays in this volume would appear on anyone's list. I strongly recommend this book for research scientists and graduate students of forest economics as an essential addition to their reference library.     

Optimal forest harvest age considering carbon sequestration in multiple carbon pools: A comparative statics analysis

We present an analytical model for determination of the economically optimal harvest age of a forest stand considering timber value, and the value of carbon fluxes in living biomass, dead organic matter, and wood products pools. Through comparative statics analysis, we find that consideration of timber value and fluxes in biomass carbon increase harvest age relative to the timber only solution, and that the effect on optimal harvest age of incorporating fluxes in the dead organic matter and wood products pools is indeterminate.We also present a numerical example to examine the magnitudes of these effects. In general, incorporating the dead organic matter and wood products pools have the effect of reducing rotation age. Perhaps more interestingly, when initial stocks of carbon in dead organic matter or wood products pool are relatively high, consideration of these pools can have a highly negative effect on net present value.     

Editorial - Multiple-use forestry

The problem of multiple-use forestry arises because (1) a forest can be managed to provide a wide range of products and services, (2) the different uses are not perfectly compatible with each other, and (3) some products are not priced in markets and many of the services a forest provides have the characteristics of public goods. Examples of major forest products include, in addition to timber, edible berries, fungi, and hunting games. Forests also provide recreation opportunities and various environmental services (such as regulating local climate, reducing soil erosion, reducing pollutants in the atmosphere, regulating the global climate, providing habitats for wildlife, etc.). The outputs of nontimber goods in general depend on the quantity and structure of the forest, which can be changed by various forest management activities. However, a forest state most suitable for the production of one good is usually not optimal with respect to another good. Typically, there does not exist a set of management activities that simultaneously maximize the outputs of timber and all other goods.Another way to understand the conflicts between different uses is to view standing timber as an intermediate product of forestry investment, which is employed as an “input” for the production of timber products and nontimber goods. Thinking in this way, the conflicts arise partly because timber production and nontimber uses compete for the same input, and partly because of the differences in the “production technology” among different nontimber goods. A change in the standing timber may have positive impacts on some nontimber uses, but have negative effects on others. Because of the conflicts among different uses, it requires that both timber products and nontimber goods should be explicitly incorporated into forestry decision-making in order to achieve the greatest benefits to the forest owner and/or the public.Most of the economic analyses of multiple-use forestry decisions have explicitly or implicitly adopted the view that multiple-use should be achieved in individual stands. Each stand should be managed to produce an optimal mix of timber products and nontimber goods. Another view of multiple-use forestry is to manage each stand for a primary use, whereas multiple-use concerns are addressed by allocating different stands in a forest to different uses. A general argument in support of the primary-use view is that specialization makes for efficiency. The production of timber and nontimber goods is a joint process, however. Strictly speaking, one cannot separate timber production and the production of different nontimber goods. For example, managing a stand for timber production does not exclude the possibility of producing some nontimber goods in the stand. Since every stand usually produces more than one product, efficient multiple-use forestry requires that each stand should be managed for an optimal mix of timber and nontimber outputs. On the other hand, it may well be the case that the optimal multiple-use mix for a particular stand consists of a maximum output of one product. In this case the optimal multiple-use management decision would coincide with the optimal decision pertaining to a single use. In other words, it may be optimal to manage a particular stand for one primary use. Using the terminology of economics, primary-use may be efficient for stands in which the multiple-use production set is nonconvex. Recent research has explored several sources of nonconvexity in the multiple-use production set. However, there is no evidence supporting the argument that specialization is always more efficient than multiple-use management of individual stands. From an economics viewpoint, efficient primary-use is special cases of multiple-use stand management.A widely recognized limitation of multiple-use stand management is that, by considering each stand separately, one neglects the interdependence of nontimber benefits and ecological interactions among individual stands. The nontimber benefits of a stand depend on the output of nontimber goods from other stands. Likewise, the nontimber output from one stand affects the value of nontimber goods produced in the other stands. Ecological interactions among individual stands imply that the output of nontimber goods from two stands in a forest differs from the sum of the outputs from two isolated stands. These interdependence and interactions imply that the relationship between the nontimber benefits of a stand and the stand age (or standing timber stock) cannot be unambiguously determined - it depends on the flow of nontimber goods produced in the surrounding stands. Therefore, it is improper to determine optimal decisions for the individual stands independently. In stead, efficient multiple-use forestry decision should be analyzed by considering all the stands in a forest simultaneously.Another serious limitation of multiple-use stand management is that each stand is treated as a homogenous management unit to be managed according to a uniform management regime. One implicitly assumes that the boundaries of each stand is exogenously given and will remain unchanged over time. This assumption imposes a restriction on the multiple-use production set, thereby creates inefficiency. As an example, consider a large stand with a nonconvex production set. It may be possible to eliminate nonconvexity in the production set and push the production possibility frontier outwards by dividing the stand into several parts and managing each part for a primary-use. It may also be efficient to combine two adjacent stands into one to be managed following a uniform regime, because of the presences of fixed management costs, and/or because the relationship between some nontimber outputs and stand area is not linear.In contrast to income from timber production, nontimber goods produced at different time points are not perfect substitutes. The rate at which a forest owner is willing to substitute a nontimber good produced at one time point for that produced at another time point changes with the outputs of the nontimber good at the two time points. In general cases, the nontimber goods produced at one time point cannot be consumed at another time point, and the marginal utility of a nontimber good decreases when its output increases. This provides a motivation for reducing the variation in the output of nontimber goods over time. An effective approach to coordinating nontimber outputs over time is to apply different management regimes to different parts of a stand, or apply the same regime to adjacent stands, which would change the boundaries of the stands. Preserving the existing stand boundaries would limit the possibility of evening out the nontimber outputs over time, and thereby lead to intertemporal inefficiency in multiple-use management.In previous studies of multiple-use forestry decisions the nontimber outputs or benefits are usually modeled as functions of stand age or standing timber stock. Future flows of nontimber goods or benefits are incorporated into a stand/forest harvest decision model to explore the implications of nontimber uses for optimal harvest decisions. While stand age and standing timber stock may have significant impacts on nontimber outputs, other forest state variables, e. g. the spatial distribution of stands of different ages/species, may be of great importance to the production of nontimber goods. Recognition of such forest state variables could change the relationship between timber production and nontimber outputs and therefore change the optimal forest management decisions.In summary, multiple-use forestry is not simply an extension of timber management with additional flows of benefits to be considered when evaluating alternative management regimes. Recognition of multiple uses of a forest leads to two fundamental changes of the forestry decision problem. First, the optimal intertemporal consumption of forestry income is no longer separable from forest management decisions. In general, the optimal intertemporal consumption of forestry income depends on future flows of nontimber goods, implying that the consumption-saving decision should be made simultaneously with the decision on the production of timber and nontimber goods over time. Secondly, it is no longer appropriate to optimize the management regime for each stand separately. The nontimber outputs from a forest depend on the age distribution of individual stands, and on a wide range of other forest state variables such as the spatial distribution of stands of different ages and tree-species composition. Ecological interactions and interdependence among stands imply that management regimes for different stands should be optimized simultaneously. In addition to changing rotation ages and harvest levels, efficient multiple-use forestry requires optimizing the spatial allocation of harvests, redefining the boundaries of stands, coordinating the choices of tree species in regeneration of harvested area and so on.The lack of rigorous production functions for nontimber goods imposes a severe restriction on attempts to perform comprehensive economic analyses of multiple-use forestry decisions. This restriction in itself is no justification for ignoring many of the key aspects of multiple-use forestry problem and modeling the problem as one of determining the optimal rotation age or optimal harvest level. It requires that economic models of multiple-use forestry should be developed with special consideration of the vague and imprecise information regarding the relationships between nontimber outputs and forest state variables.Peichen GongDepartment of Forest EconomicsSE-90183 UmeåSweden     

Optimizing joint production of timber and carbon sequestration of afforestation projects

Optimizing harvesting decisions has been a matter of concern in the forestry literature for centuries. However, in some tropical countries, growth models for fast-growing tree species have been developed only recently. Additionally, environmental services of forests gain importance and should be integrated in forest management decisions. We determine the impact of a joint production of timber and carbon sequestration on the optimal rotation of a fast-growing species in north-western Ecuador, comparing different optimization approaches and taking the latest developments of the Kyoto Protocol into account. We find that payments for carbon sequestration have substantial impact on the rotation length: in contrast to an optimum of 15 years when focusing on timber production only, joint production leads to a doubling of the rotation length, which means that timber harvest should be postponed until the end of the carbon project.     

A Pest and Timber Management Model: Jack Pine Budworm and Jack Pine

A simple illustrative mathematical model for integrating forest pest control decisions with timber management is developed for a hypothetical jack pine forest infested with jack pine budworm. Subject to several assumptions made in the model, optimal quantities and timings of pesticide application and optimal rotation ages of the forest are determined under various sets of parameters such as cost of pesticide, stumpage price, pest population growth rate and age of the forest at the time of pest infestation. The sensitivities of the optimal values to these parameters are examined. In general, the rotation age and hence harvesting schedule is affected under different pest situations, site conditions and economic parameters. In addition, immediate pest control action following noticeable pest infestation in young crops may not always be the most profitable decision, particularly when only one pesticide application is permitted and when net return expected from a crop is low. These findings have implications for effective pest and timber management. Nous avons élaborté un modéle mathématique simple intégrant les décisions de lutte contre les parasites forestiers et la gestion du bois d'oeuvre pour une forit de pins gris hypothétique infestée de tordeuses du pin gris. Nous avons ainsi déterminé les quantités optimales et l'échéancier pour l'épandage de pesticides ainsi que l'âge optimal de rotation de la forêt, compte tenu de divers groupes de parametres (par exemple, coût des pesticides, prix du bois sur pied, taux de croissance et date de l'infestation), en vertu de diverses hypothèses de départ intégrées dans le modèle. Nous avons examiné la sensibilité des valeurs optimales face è ces paramètres. En général, l'âge de rotation et, par ricochet, l'échéancier de la récolte changent en fonction de I'ampleur de I'infestation, de l'état du peupfement et des paramétres économiques. En outre, I'application de mesures immédiates de lutte dès les premiers signes d'une infestation dans les jeunes peuplements risque de ne pas toujours étre la decision la plus profitable, en particulier lorsqu'on ne permet qu'un seul épandange et que le revenu attendu d'une récolte est faible. Ces résultats ont une incidence sur les mesures de lutte antiparasitaire et sur la gestion du bois d'oeuvre.     

Adaptive thinning strategies for mixed-species stand management with stochastic prices

This paper presents an efficient and flexible approach of determining optimal thinning strategies for mixed-species stands with stochastic timber prices. The approach aims to determine the optimal stock of each species to be maintained in the stand conditional on the observed stand state and timber prices, whereas thinning intensity is given by the difference between the existing and the optimal stocks. For demonstration purpose, the approach is applied to determine the optimal thinning strategies for an example stand of Scots pine (Pinus Sylvestris L.) and Norway spruce (Picea abies L. Karst.) in northern Sweden. The optimal stock of each species is formulated as a parametric function of stand age and stumpage prices of the respective species. A reservation price function is constructed to determine the optimal time of clearcut based on the observed stand state and timber prices. The parameters of the optimal stock-level and reservation price functions are determined by maximizing the expected present value of the stand. The results indicate that using the optimal stock-level function approach can significantly improve the thinning decisions for mixed species stand with stochastic timber prices.     

用材林林地资产动态评估模型构建研究

以福建省西北部用材林为研究对象,在林地期望价修正法的基础上,考虑随着时间推移和社会经济变异所引起的林地质量差异、地区差异和物价变异,构建出由林地标准地租、立地差异系数、集材费用、运输费用、地区差异系数和物价变动指数所组成林地资产动态评估模型。研究结果表明,该模型是符合福建省西北部当地的地租水平的,可方便、快捷地对用材林林地资产进行评定估。     

Stumpage prices in Sweden 1909–2012: Testing for non-stationarity

The price of timber stumpage is one of the few natural-resource rents that can be directly observed as a market price. Rules for optimal timber harvesting under uncertainty have been found to depend on whether the timber rent price is non-stationary or stationary. In this study we extend previous research by Hultkrantz (1995) that tested for unit-root with an exogenous break point in Swedish stumpage prices from 1909 to 1990, employing data up to 2012, hence for 104 years, and unit-root tests with endogenously selected break points. We find support for a structural level break at the end of WW2 and that non-stationarity can be rejected. We show that this is a robust conclusion. There is thus no sign of a new break in the extended recent time period and no signal of a secular increase of timber resource scarcity.     

Efficiency in forest management: A multiobjective harvest scheduling model

This paper presents a new forest harvest scheduling model taking into account four conflicting objectives. The economic factor of timber production is considered and also aspects related to environmental protection. We also incorporate adjacency constraints to limit the maximum contiguous area where clear-cutting can be applied. The model proposed is applied to a timber production plantation in Cuba located in the region of Pinar del Río. One factor to be taken into account in Cuban plantations is that the forest has a highly unbalanced age distribution. Therefore, in addition to the classical objectives of forest planning, we have the objective of rebalancing age distribution by the end of the planning horizon. Explicitly, the four objectives considered in the model are: (a) obtaining a balance-aged forest; (b) minimizing the area with trees older than the rotation age; (c) maximizing the NPV of the forest over the planning horizon; and (d) maximizing total carbon sequestration over the whole planning horizon. The solution to the proposed model provides a set of efficient management plans that are of assistance in analysing the tradeoffs between the economic and ecological objectives. The model is also applied to randomly generated simulated forests to compare its performance in other contexts. As the problem is a multiobjective binary nonlinear model, a metaheuristic procedure is used in order to solve it.     

Pressler's indicator rate formula as a guide for forest management

In this paper, it is shown that Pressler's indicator rate formula is also the optimal condition for the determination of the optimal harvest age under the generalized Faustmann formula. In addition, a modern treatment of the quantity increment, quality increment, and price increment is presented. Pressler's indicator rate formula is then applied to determine the optimal harvest age in a dynamic world of unanticipated changes.     

Economics of carbon sequestration under fluctuating economic environment,forest management and technological changes: An application to forest stands in the southern United States

This study presents a model that determines the effect of current and future payments for carbon sequestration, proportion of wood that sequesters carbon in long-lived product and landfills, and amount of carbon in the wood, on the optimal current forest harvest age. Increased current and future prices of carbon would lead to a longer and shorter harvest age, respectively. Higher current prices of carbon could increase the supply of carbon at a decreasing rate due to longer harvest ages. Moderate prices of carbon would encourage landowners to maintain standing timber. Policies focused then on stimulating landowners to hold timber on forestlands may not necessarily imply higher amounts of sequestered carbon. Increased future values of carbon could imply a reduction of the current supply of carbon.     

Market and welfare implications of the reservation price strategy for forest harvest decisions

Previous studies have reported significant gains from adopting the adaptive harvest strategy under conditions of timber price uncertainty. For the final harvest decision in even-aged stand management, the adaptive strategy typically means that a stand is harvested when the timber price is sufficiently high, whereas low prices are avoided by postponing the harvest. Such a harvest behavior may have significant impacts on the future price process, which in turn affects the landowner's profits. Moreover, it would certainly affect the timber-based industry and consumers. This paper assesses these impacts in a hypothetical timber market, using the Faustmann rule (FR) as a benchmark. The results show that changing from the FR to the reservation price strategy (RPS) reduces the supply of timber, thereby pushes up the price level. The RPS significantly reduces the short-run random variation of timber price. In the long run, both the mean and the variance of the timber price tend to stabilize. Depending on the anticipated price variation underlying the RPS, the expected timber price may be close to, or much higher than, the benchmark level, and the variance of price can be very large or very small. The welfare effect of the RPS is small if the anticipated variance of timber price used to optimize the RPS is small. If the anticipated variance of price is large, then the RSP leads to significant increase in the landowners’ profits and at the same time reduces the consumer surplus by a much larger amount.     

浅谈贮木场的挖潜增效——以内蒙古满归林业局为例

从四个方面论述了贮木场在振兴林业工作中如何挖潜增效:完善制度和措施,提升企业管理水平;以人为本提高职工队伍整体素质;合理造材,实现木材效益最大化;加大剩余物的综合利用。     

Yield quality and irrigation with saline water under environmental limitations: the case of processing tomatoes in California

Irrigation with saline water has a positive impact on some quality indices of processing tomatoes, but with concomitant reductions in output quantity. This article studies the impact of the trade‐off between these two factors on optimal water management under waterlogging and costly drainage‐disposal conditions. The focus is on the content of total soluble solids as a quality measure affecting prices paid by California processors to tomato growers. A function relating quality to water and salinity applications and a quality hedonic‐price function are estimated and introduced into a static, field‐level mathematical programming model. The model calculates optimal water management under environmental regulations associated with drainage disposal in California. Findings indicate that only when the quality effect is taken into account does blending fresh surface‐water with saline drain‐water become an optimal strategy. Management and policy implications on the regional scale are discussed.     

Effect of conserving habitat for biodiversity on optimal management of non-industrial private forests in Florida

Healthy forests and enhanced habitat for wildlife is a growing concern among public and policy makers. These concerns have led to substantial interest in promoting various regulatory and voluntary compliance policies to further biodiversity on private forests. These policies, however, might result in additional cost to forestland owners. In this paper, we estimate the opportunity cost of adopting various biodiversity-friendly forest practices. We do this in the context of slash pine, a dominant commercial tree plantation species in Florida. Results suggest that prescribed burning, invasive species control, maintaining streamside buffer zones, and extending timber harvest beyond the optimal rotation age would significantly decrease the profitability of slash pine forestry. If the major objective of landowners is to maximize profits, results indicate that they are less likely to adopt these practices at socially desirable levels without a policy support. More specifically, results suggest that an annual payment of $38–83 per hectare is required for landowners to adopt these practices. The paper further argues that application of mere command-and-control approaches to implement these practices may result in conversion of private forests to other competitive land uses.