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European Journal of Forest Research

, Volume 130, Issue 3, pp 353–368 | Cite as

The Faustmann model as a model for a forestry of prices

  • Peter Deegen
  • Martin Hostettler
  • Guillermo A. Navarro
Original Paper

Abstract

The relation between the Faustmann model and “a forestry of prices” as a concept of thought was examined. At first, the meaning of the Faustmann model in economic sciences is the explanation of allocation and distribution by prices. The rotation age determination plays a secondary role only. Secondly, “a forestry of prices” as an application of the “free to choose” way of thinking is explained. The concept allows us to understand how individuals of anonymous groups achieve forest sustainability and provide forest environmental goods. Thirdly, the relation between the Faustmann model and “a forestry of prices” is discussed. For this purpose, the Faustmann model is described as a scientific laboratory. It helps us to observe how equilibrium arises as a non-intended result of individual welfare maximization in anonymous interactions. And conversely with the help of “a forestry of prices”, we understand also that the individual maximization approach of the Faustmann model re-enacts the unintended interaction situations in anonymous group. With help of the Faustmann model, we can understand deep aspects of “a forestry of prices”. Vice versa, “a forestry of prices” shows the meaning of the formal solutions of the Faustmann model.

Keywords

Faustmann model Interaction theory Competitive market Concept of thought Allocation Distribution 

Notes

Acknowledgments

The institute of forestry economics at the University of Freiburg is really a “free to think” place, where a lot of our ideas evolved. For the constructive critiques to an early version of this paper, we thank very much Chantal, Achim, Errol, Roderich, and all our friends at the seminar in the Mathislehuette in January 2008. Detailed comments came from Gerhard Oesten and Lars Liebig: Many thanks. Also we would like to thank the anonymous reviewer for the helpful comments.

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Copyright information

© Springer-Verlag 2009

Authors and Affiliations

  • Peter Deegen
    • 1
  • Martin Hostettler
    • 2
  • Guillermo A. Navarro
    • 3
  1. 1.Institut für Forstökonomie und ForsteinrichtungTU DresdenTharandtGermany
  2. 2.Cycad AGBernSwitzerland
  3. 3.CATIE 7170Cartago, TurrialbaCosta Rica

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