Journal of Forest Economics > Vol 16 > Issue 4

Application of the generalized Faustmann model to uneven-aged forest management

Sun Joseph Chang, , xp2610@lsu.edu Klaus V. Gadow, ,
 
Suggested Citation
Sun Joseph Chang and Klaus V. Gadow (2010), "Application of the generalized Faustmann model to uneven-aged forest management", Journal of Forest Economics: Vol. 16: No. 4, pp 313-325. http://dx.doi.org/10.1016/j.jfe.2010.06.002

Publication Date: 0/12/2010
© 0 2010 Sun Joseph Chang, Klaus V. Gadow
 
Subjects
 
Keywords
JEL Codes:Q230Q570
Generalized Faustmann modelContinuous cover forestUneven-aged managementLoblolly-shortleaf pine forestComparative static analysisSensitivity analysis
 

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In this article:
Introduction 
The generalized Faustmann approach 
The economic interpretation of the optimal cutting cycle and residual growing stock 
Comparative static analysis 
Empirical analysis – the management of a loblolly-shortleaf pine stand 
Sensitivity analysis 
Solving for multiple tis and gis 
Discussion and conclusion 

Abstract

In this paper, a generalized Faustmann model is developed for uneven-aged management to allow the number of years and the level of residual growing stock to vary from one cutting cycle to the next. Comparative static analyses are conducted to determine the effect of changes in interest rate, stumpage price of the trees selected for harvest, the stumpage value of the residual growing stock, and the future land value on the decision variables. The model is then applied to study the uneven-aged management of a loblolly-shortleaf pine stand in south central U.S. to determine the length of the cutting cycle and the level of residual growing stock for the first cutting cycle as well as for a case involving four cutting cycles. Sensitivity analyses reveal that for the uneven-aged loblolly-shortleaf pine stand both the length of the cutting cycle and the level of the residual growing stock are very sensitive to changes in land value in the future, in the stumpage prices of trees selected for harvest, in the stumpage prices of the residual growing stock, and in the interest rate.

DOI:10.1016/j.jfe.2010.06.002