The optimal selective logging regime and the Faustmann formula

This study analyzes the optimal selective logging regime of a size-distributed forest where individual trees compete for scarce resources such as space, light, and nutrients. The decision problem of the forest manager is formulated as a distributed optimal control problem. The interpretation of the first-order conditions allows a generalization of the Faustmann formula. In an empirical part, this article numerically determines the optimal management regime of a size-structured forest and shows that the optimal selective logging regime is associated with a normal forest under a wider variety of situations than stated in the previous literature.     

On dichotomous choice contingent valuation data analysis: Semiparametric methods and Genetic Programming

The aim of this paper is twofold. Firstly, we introduce a novel semiparametric technique called Genetic Programming to estimate and explain the willingness to pay to maintain environmental conditions of a specific natural park in Spain. To the authors’ knowledge, this is the first time in which Genetic Programming is employed in contingent valuation. Secondly, we investigate the existence of bias due to the functional rigidity of the traditional parametric techniques commonly employed in a contingent valuation problem. We applied standard parametric methods (logit and probit) and compared with results obtained using semiparametric methods (a proportional hazard model and a genetic program). The parametric and semiparametric methods give similar results in terms of the variables finally chosen in the model. Therefore, the results confirm the internal validity of our contingent valuation exercise.     

DIVIDING GOVERNMENT PRODUCT BETWEEN INTERMEDIATE AND FINAL USES

This paper explores the possibility of using the Classification of the Functions of Government published recently by the United Nations (COFOG) in order to segregate intermediate from final use of government production in the national accounts. It is argued that the notorious difficulties of doing that can be traced to two reasons, one the multiplicity of theoretical concepts, and the other the lack of sufficient detail at the statistical level. The first can be removed by clarifying that on the production account of an economy only production and not welfare is to be measured. The second seems to be overcome by the three-digit detail of COFOG. It is shown that many of these categories are now sufficiently homogeneous for a panel of experts to agree in assigning them to either intermediate or final use, although for a number of categories this is still difficult. The question is whether consensus in the major categories is large enough to consider the remaining controversial ones as border cases, normal in any classification and solved in the last instance not by argument but by convention. Some preliminary figures for the intermediate part of government production are given.     

Cost-utility analysis of the rehabilitation of patients with musculoskeletal problems

The objective of this study is to discuss the rehabilitation of patients in primary health care with problems in the musculoskeletal system from a socioeconomic perspective. A trial with coordinated rehabilitation in primary health care is compared with traditional rehabilitation. This trial, performed in Sweden in 1994, was a two-year prospective and comparative study of consecutively included patients with long-term illnesses due musculoskeletal problems (810 observations). A cost-utility analysis shows that the new rehabilitation program in primary health care is a cost-minimization program for society. There is no significant difference in the quality of life between the trial and control groups. The total cost is lower for rehabilitation in primary health care than for traditional rehabilitation (6 percent). The indirect costs are higher than the direct health care costs (60 percent), and payments from social insurance increased by 8 percent. The health economic results support rehabilitation in primary health care but also points out that this type of rehabilitation can be further improved.