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Optimum cutting age for timber resources with carbon sequestration

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  • Gunalay, Y.
  • Kula, E.

Abstract

Determining the optimum cutting age for timber resources has proved to be a very challenging problem for both economists and silviculturists. Based upon Samuelson's seminal work on this issue, the majority of economists have concluded that the optimum felling age occurs at a time when the net marginal benefits fall below the current rate of interest. Recently, concern about climate change has increased the importance of forestry projects, since trees act as natural biological scrubbers by removing CO2 from the atmosphere. By incorporating these carbon sequestration benefits, this paper re-determines the optimum cutting age using a multiple rotation model. The results of this reformulation show that, in afforestation projects, trees should remain in the ground longer than the period suggested by a timber-only model in order to absorb more CO2.

Suggested Citation

  • Gunalay, Y. & Kula, E., 2012. "Optimum cutting age for timber resources with carbon sequestration," Resources Policy, Elsevier, vol. 37(1), pages 90-92.
    • Handle: RePEc:eee:jrpoli:v:37:y:2012:i:1:p:90-92
    DOI: 10.1016/j.resourpol.2011.12.001
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    References listed on IDEAS

    as
    1. Kula, Erhun, 1986. "A rate of return analysis for public forestry in Ulster," Resources Policy, Elsevier, vol. 12(4), pages 346-350, December.
    2. Harold Hotelling, 1931. "The Economics of Exhaustible Resources," Journal of Political Economy, University of Chicago Press, vol. 39(2), pages 137-137.
    3. Samuelson, Paul A, 1976. "Economics of Forestry in an Evolving Society," Economic Inquiry, Western Economic Association International, vol. 14(4), pages 466-492, December.
    4. K. E. Boulding, 1935. "The Theory of a Single Investment," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 49(3), pages 475-494.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Forest resources; Climate change; Cost-benefit analysis;
    All these keywords.

    JEL classification:

    • C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis
    • Q23 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Forestry
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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