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Regeneration decisions in forestry under climate change related uncertainties and risks: Effects of three different aspects of uncertainty

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  • Schou, Erik
  • Thorsen, Bo Jellesmark
  • Jacobsen, Jette Bredahl

Abstract

Future climate development and its effects on forest ecosystems are not easily predicted or described in terms of standard probability concepts. Nevertheless, forest managers continuously make long-term decisions that will be subject to climate change impacts. The manager's assessment of possible developments and impacts and the related uncertainty will affect the combined decision on timing of final harvest and the choice of species for regeneration. We analyse harvest of a Norway spruce stand with the option to regenerate with Norway spruce or oak. We use simulated variations in biophysical risks to generate a set of alternative outcomes, investigating effects on decision making of three aspects of uncertainty: (i) the perceived time horizon before there will be certainty on outcome, (ii) the spread of impacts across the set of alternative outcomes, and (iii) the subjective probability (belief) assigned to each outcome. Results show that the later a forest manager expects to obtain certainty about climate change or the more skewed their belief distribution, the more will decisions be based on ex ante assessments — suggesting that if forest managers believe that climate change uncertainty will prevail for a longer period of time, they may make sub-optimal decisions ex ante.

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  • Schou, Erik & Thorsen, Bo Jellesmark & Jacobsen, Jette Bredahl, 2015. "Regeneration decisions in forestry under climate change related uncertainties and risks: Effects of three different aspects of uncertainty," Forest Policy and Economics, Elsevier, vol. 50(C), pages 11-19.
    • Handle: RePEc:eee:forpol:v:50:y:2015:i:c:p:11-19
    DOI: 10.1016/j.forpol.2014.09.006
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    References listed on IDEAS

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    Cited by:

    1. Couture, Stéphane & Cros, Marie-Josée & Sabbadin, Régis, 2016. "Risk aversion and optimal management of an uneven-aged forest under risk of windthrow: A Markov decision process approach," Journal of Forest Economics, Elsevier, vol. 25(C), pages 94-114.
    2. Lidskog, Rolf & Löfmarck, Erik, 2016. "Fostering a flexible forest: Challenges and strategies in the advisory practice of a deregulated forest management system," Forest Policy and Economics, Elsevier, vol. 62(C), pages 177-183.

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