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Optimal forest rotation age under efficient climate change mitigation

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  • Ekholm, Tommi

Abstract

This paper considers the optimal rotation of forests when the carbon flows from forest growth and harvest are priced with an increasing price. Such evolution of carbon price is generally associated with economically efficient climate change mitigation, and would provide incentives for the land-owner for enhanced carbon sequestration. For an infinitely long sequence of even-aged forest rotations, the optimal harvest age changes with subsequent rotations due to the changing carbon price. The first-order optimality conditions therefore also involve an infinite chain of lengths for consecutive forest rotations, and allow the approximation of the infinite-time problem with a truncated series of forest rotations.

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  • Ekholm, Tommi, 2016. "Optimal forest rotation age under efficient climate change mitigation," Forest Policy and Economics, Elsevier, vol. 62(C), pages 62-68.
    • Handle: RePEc:eee:forpol:v:62:y:2016:i:c:p:62-68
    DOI: 10.1016/j.forpol.2015.10.007
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    References listed on IDEAS

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    Cited by:

    1. Jussi Lintunen & Aapo Rautiainen & Jussi Uusivuori, 2022. "Which Is more Important, Carbon or Albedo? Optimizing Harvest Rotations for Timber and Climate Benefits in a Changing Climate," American Journal of Agricultural Economics, John Wiley & Sons, vol. 104(1), pages 134-160, January.
    2. Tommi Ekholm, 2019. "Optimal forest rotation under carbon pricing and forest damage risk," Papers 1912.00269, arXiv.org.
    3. Ekholm, Tommi, 2020. "Optimal forest rotation under carbon pricing and forest damage risk," Forest Policy and Economics, Elsevier, vol. 115(C).
    4. Ben Abdallah, Skander & Lasserre, Pierre, 2017. "Forest land value and rotation with an alternative land use," Journal of Forest Economics, Elsevier, vol. 29(PB), pages 118-127.
    5. Yu, Zhihan & Ning, Zhuo & Chang, Wei-Yew & Chang, Sun Joseph & Yang, Hongqiang, 2023. "Optimal harvest decisions for the management of carbon sequestration forests under price uncertainty and risk preferences," Forest Policy and Economics, Elsevier, vol. 151(C).
    6. Nguyen, Trung Thanh & Nghiem, Nhung, 2016. "Optimal forest rotation for carbon sequestration and biodiversity conservation by farm income levels," Forest Policy and Economics, Elsevier, vol. 73(C), pages 185-194.
    7. Riikka Siljander & Tommi Ekholm, 2018. "Integrated scenario modelling of energy, greenhouse gas emissions and forestry," Mitigation and Adaptation Strategies for Global Change, Springer, vol. 23(5), pages 783-802, June.
    8. Xie, Yalin & Lei, Xiangdong & Shi, Jingning, 2020. "Impacts of climate change on biological rotation of Larix olgensis plantations for timber production and carbon storage in northeast China using the 3-PGmix model," Ecological Modelling, Elsevier, vol. 435(C).
    9. Price, Colin, 2017. "Optimal rotation with differently-discounted benefit streams," Journal of Forest Economics, Elsevier, vol. 26(C), pages 1-8.
    10. Susaeta, Andres & Adams, Damian C. & Gonzalez-Benecke, Carlos, 2017. "Economic vulnerability of southern US slash pine forests to climate change," Journal of Forest Economics, Elsevier, vol. 28(C), pages 18-32.

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