A Reformulation of the Cost Plus Net Value Change (C+NVC) Model of Wildfire Economics

Authors: Donovan G.H.¹; Rideout D.B.²

Source: Forest Science, Volume 49, Number 2, April 2003 , pp. 318-323(6)

Publisher: Society of American Foresters

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Abstract:

The Cost plus Net Value Change (C+NVC) model provides the theoretical foundation for wildland fire economics and provides the basis for the National Fire Management Analysis System (NFMAS). The C+NVC model is based on the earlier least Cost plus Loss model (LC+L) expressed by Sparhawk (1925). Mathematical and graphical analysis of the LC+L model illustrates two errors in model formulation. First, suppression is incorrectly modeled as a model output. Second, suppression and primary protection are incorrectly modeled as negatively correlated. These errors are shown to be perpetuated by the contemporary C+NVC model and to have serious implications for the model's capacity to correctly identify the most efficient level of fire management expenditure. A corrected graphical representation of the C+NVC model is presented, which allows the most efficient level of fire management expenditure to be correctly identified. FOR. SCI. 49(2):318–323.

Keywords: Economics; fire; cost plus net value change; environmental management; forest; forest management; forest resources; forestry; forestry research; forestry science; natural resources; natural resource management

Document Type: Miscellaneous

Affiliations: 1: Research Forester Pacific Northwest Research Station, USDA Forest Service, Portland, OR, 2: Professor Department of Forest Science, Colorado State University, Fort Collins, CO, 80523, Phone: (503)808-2043 gdonovan@fs.fed.us

Publication date: 2003-04-01

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