On the Economic Value of Genetic Progress in Forestry

Author: Löfgren, Karl-Gustaf

Source: Forest Science, Volume 34, Number 3, 1 September 1988 , pp. 708-723(16)

Publisher: Society of American Foresters

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Abstract:

This paper extends previous analyses of the economics of tree improvement by introducing a number of general theorems on the properties of the present value function as a function of biotechnological parameters. More specifically it is shown how the economic gains from the improvement can be given upper and lower bounds, which to a certain extent are expressable in entities known from current management practices. The general theorems are derived from a model of a present value maximizing forestry firm with an initial endowment consisting of trees in different age classes, which is facing a competitive environment. However, since certain types of improvements are more easily handled at the stand level, a special section is devoted to the economics of genetic progress at the stand level. The core results show that straightforward calculation methods often have theoretical support. An empirical application at the end of the paper also shows that the theory has practical implications. For. Sci. 34(3):708-723.

Keywords: Tree improvement; economics

Document Type: Journal article

Affiliations: 1: Department of Economics, Swedish University of Agricultural Sciences, Umeå Sweden

Publication date: 1988-09-01

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