Debunking the forest rent model fallacy in a fully regulated forest

Document Type

Article

Publication Date

2-1-2020

Abstract

In this paper, we first show both mathematically and empirically that the forest rent model is the wrong model to determine the optimal rotation age of a fully regulated forest as long as the standing timber has value. We then demonstrate that even if the forest is acquired for free, a fully regulated forest based on the forest rent model is actually worth more than the present value of its annual income. By converting to a fully regulated forest with a shorter rotation under the land expectation model, a higher present value of over 10% can be realized.

Publication Source (Journal or Book title)

European Journal of Forest Research

First Page

145

Last Page

150

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