Stumpage Price Uncertainty and the Optimal Rotation of a Multiple Use Forest: An Application of Sandmo Model
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The Faustmann model has played a key role in the determination of optimal forest rotations. Faustmann (1849) developed a simple and deterministic competitive economic model, the objective of which was to maximize the present value of perpetual returns to the fixed factor, a unit of timber land. The optimal rotation problem thus viewed is a timber management problem abstracting from the multiple use characteristics of a forest stand and any environment of uncertainty. Hartman (1976) developed a modified deterministic Faustmann model where a standing forest has value in the form of "recreation", a general term used to capture non-timber forest uses. He did not consider regeneration costs and the costs of making recreation available to users.
This paper has been withdrawn.