Alternative Methods of Calculating Optimal Timber Rotations: A Critique of the Stokey/Lucas/Prescott Tree-Cutting Problem
AbstractThe traditional question of optimally deciding when to cut down a tree is among the most commonly posed questions asked of students learning the technique of dynamic programming. This paper shows that the traditional tree-cutting example is improperly formulated when the question of replanting is addressed, derives the proper method of finding optimal harvest length, and applies this method to an empirical forest growth function.
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Bibliographic InfoPaper provided by College of the Holy Cross, Department of Economics in its series Working Papers with number 0701.
Length: 9 pages
Date of creation: Jan 2007
Date of revision:
Publication status: Published in Applied Economics Letters, Vol. 16:10, July 2009, 1079-1081.
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Web page: http://www.holycross.edu/departments/economics/website/
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forestry; dynamic programing; tree cutting problem;
Other versions of this item:
- Victor Matheson, 2009. "Alternative methods of calculating optimal timber rotations: a critique of the Stokey/Lucas/Prescott tree-cutting problem," Applied Economics Letters, Taylor and Francis Journals, vol. 16(10), pages 1079-1081.
- C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis
- G31 - Financial Economics - - Corporate Finance and Governance - - - Capital Budgeting; Fixed Investment and Inventory Studies
- Q23 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Forestry
This paper has been announced in the following NEP Reports:
- NEP-ALL-2007-01-23 (All new papers)
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- Thang, Tran Cong & Burton, Michael P. & Brennan, Donna C., 2009. "Optimal replanting and cutting rule for coffee farmers in Vietnam," 2009 Conference (53rd), February 11-13, 2009, Cairns, Australia 47638, Australian Agricultural and Resource Economics Society.
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