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Multi-stand Forest Management under a Climatic Risk: Do Time and Risk Preferences Matter?

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Abstract

We propose a stochastic dynamic programming framework to model the management of a multi-stand forest under climate risk (strong wind occurrence). The preferences of the forest-owner are specified by a non-expected utility in order to separately analyze intertemporal substitution and risk aversion effects. A numerical method is developed to characterize the optimal forest management policies and the optimal consumption-saving strategy. The stochastic dynamic programming framework is applied to a non-industrial private forest-owner located in North-East of France. We show that the optimal decisions both depend upon risk and time preferences.

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Author information

Authors and Affiliations

  1. LEF-INRA/ENGREF. 14, rue Girardet, CS 4216, 54042, Nancy cedex, France

    Stéphane Couture

  2. LERNA-INRA, Université de Toulouse 1, Manufacture des Tabacs - Bât.F, 21 allée de Brienne, 31042, Toulouse, France

    Arnaud Reynaud

Authors
  1. Stéphane Couture
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  2. Arnaud Reynaud
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Correspondence to Arnaud Reynaud.

Additional information

The authors would like to thank participants at the international conference on Economics of Sustainable Forest Management in Toronto, at the PARIS 1 seminar on Environmental and Natural Resource Economics, at the 2004 Applied Microeconomics Conference in Lille and at the 13th annual conference of the European Association of Environmental and Resource Economists at Budapest.

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Couture, S., Reynaud, A. Multi-stand Forest Management under a Climatic Risk: Do Time and Risk Preferences Matter?. Environ Model Assess 13, 181–193 (2008). https://doi.org/10.1007/s10666-007-9121-7

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  • DOI: https://doi.org/10.1007/s10666-007-9121-7

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