Forest land value and rotation with an alternative land use |
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Institution: | 1. Department of Forestry and Environmental Resources, North Carolina State University, 2820 Faucette Dr., Raleigh, NC 27695, USA;2. USDA Forest Service Southern Research Station-Research Triangle Park, 3041 East Cornwallis Road, RTP, NC 27709, USA |
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Abstract: | We solve Faustmann's problem when the land manager plans to switch from the current tree species to some alternative species or land use. Such situations occur when the value of the alternative increases relative to the value of the species currently in place. The paper characterizes the land value function and the optimum rotations, highlighting the differences between this non-autonomous problem and the traditional Faustmann problem. We show that, from one harvest to the next until the switch, rotations can be constant and equal to the Faustmann rotation, or increasingly higher than the Faustmann rotation, or decreasingly lower. In the last two situations, the higher the number of previous harvests of the currently planted species before the switch to the alternative use, the closer the last rotation is to the Faustmann rotation. |
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Keywords: | Forestry Land value Faustmann Alternative species Alternative land use rotation Q23 Q24 |
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