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Biotechnical portfolio management of mixed-species forests

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Journal of Bioeconomics Aims and scope

Abstract

Based upon the historical data—obtained from the French National Forest Inventory—on the tree species’ productivities, assimilated to be a measure of return on investment, as well as on their variances as sources of risk, we apply the portfolio selection theory in order to optimize the species distributions in France. We thus determine the optimal return-risk combinations of tree species and map them per administrative department. We also estimate the resistance of optimal portfolios using the species’ probabilities of presence. Our results show that greater weights in the optimal portfolios match with higher probabilities of presence, implying that foresters have incentives to invest in the most resilient species.

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Notes

  1. Equally, the number of species has been compelled by the availability of probabilities of presence, as described hereafter.

  2. This is common practice among forest data managers.

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Acknowledgements

This work was financially supported by a grant overseen by the French National Research Agency through the Laboratory of Excellence ARBRE, a part of the Investments for the Future Program (ANR 11 – LABX-0002-01). It was also supported by the French National Forestry Office through the Forests for Tomorrow International Teaching and Research Chair. The authors are endebted to Edwin van der Werf (Wageningen University) for his comments and suggestions toward this work.

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Authors and Affiliations

  1. LEF, AgroParisTech, INRA, 54000, Nancy, France

    Marielle Brunette, Arnaud Dragicevic, Jonathan Lenglet & Alexandra Niedzwiedz

  2. Istanbul Technical University [ITU, Department of Economics], 34367, Istanbul, Turkey

    Arnaud Dragicevic

  3. EEF, Lorraine University, INRA, 54000, Champenoux, France

    Vincent Badeau & Jean-Luc Dupouey

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  1. Marielle Brunette
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  2. Arnaud Dragicevic
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Correspondence to Marielle Brunette.

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Brunette, M., Dragicevic, A., Lenglet, J. et al. Biotechnical portfolio management of mixed-species forests. J Bioecon 19, 223–245 (2017). https://doi.org/10.1007/s10818-017-9247-x

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