Journal of Bioeconomics

, Volume 19, Issue 2, pp 223–245 | Cite as

Biotechnical portfolio management of mixed-species forests

  • Marielle Brunette
  • Arnaud Dragicevic
  • Jonathan Lenglet
  • Alexandra Niedzwiedz
  • Vincent Badeau
  • Jean-Luc Dupouey


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.


Bioeconomics Forest management Portfolio management Mixed-species forests Climate change 

JEL Classification

G17 Q2 Q54 



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.


  1. Allen, C. D., Macalady, A. K., Chenchouni, H., Bachelet, D., McDowell, N., Vennetier, M., Kitzberger, T., Rigling, A., Breshears, D. D., Hogg, E. T., Gonzalez, P., Fensham, R., Zhang, Z., Castro, J., Demidova, N., Lim, J.-H., Allard, G., Running, S. W., Semerci, A., & Cobb, N. (2010). A global overview of drought and heat-induced tree mortality reveals emerging climate change risks for forests. Forest Ecology and Management, 259(4), 660–684.Google Scholar
  2. Andreu, L., Gutiérrez, E., Macias, M., Ribas, M., Bosch, O., & Camarero, J. (2007). Climate increases regional tree-growth variability in Iberian pine forests. Global Change Biology, 13, 1–12.CrossRefGoogle Scholar
  3. Badeau, V., Dupouey, J.L., Cluzeau, C., Drapier, J., & Lebas, C. (2010). Climate change and the biogeography of French tree species: first result and perspectives. In Forests, carbon cycle and climate change (pp. 231–252), Editions Quae, c/o INRA; Versailles; France.Google Scholar
  4. Bigler, C., Gricar, J., Bugmann, H., & Cufar, K. (2004). Growth patterns as indicators of impending tree death in silver fir. Forest Ecology and Management, 199(2–3), 183–190.CrossRefGoogle Scholar
  5. Bosu, P. P., Cobbinah, J. R., Nichols, J. D., Nkrumah, E. E., & Wagner, M. R. (2006). Survival and growth of mixed plantations of Milicia excelsa and Terminalia superba 9 years after planting in Ghana. Forest Ecology and Management, 233(2–3), 352–357.CrossRefGoogle Scholar
  6. Bréda, N., Cochard, H., Dreyer, E., & Granier, A. (1993). Field comparison of transpiration, stomatal conductance and vulnerability to cavitation of Quercus petraea and Quercus robur under water stress. Annals of Forest Science, 50, 571–582.CrossRefGoogle Scholar
  7. Buchman, R. G., Pederson, S. P., & Walters, N. R. (1983). A tree survival model with application to species of the great lakes region. Canadian Journal of Forest Research, 13(4), 601–608.CrossRefGoogle Scholar
  8. Buongiorno, J., Peyron, J. L., Houllier, F., & Bruciamacchie, M. (1995). Growth and management of mixed-species, uneven-aged forests in the French Jura: implications for economic returns and tree diversity. Forest Science, 41(3), 397–429.Google Scholar
  9. Charru, M., Seynave, I., Morneau, F., & Bontemps, J. D. (2010). Recent changes in forest productivity: An analysis of national forest inventory data for common beech (Fagus sylvatica L.) in north-eastern France. Forest Ecology and Management, 260(5), 864–874.CrossRefGoogle Scholar
  10. Cheaib, A., Badeau, V., Boe, J., Chuine, I., Delire, C., Dufrêne, E., François, C., Gritti, E. S., Legay, M., Pagé, C., Thuiller, W., Viovy, N., & Leadley, P. (2012). Climate change impacts on tree ranges: Model intercomparison facilitates understanding and quantification of uncertainty. Ecology Letters, 15(6), 533–544.Google Scholar
  11. Clasen, C., Griess, V. C., & Knoke, T. (2011). Financial consequences of losing admixed tree species: A new approach to value increased financial risks by ungulate browsing. Forest Policy and Economics, 13(6), 503–511.CrossRefGoogle Scholar
  12. Dale, V. H., Joyce, L. A., McNulty, S., & Neilson, R. P. (2000). The interplay between climate change, forests, and disturbances. Science of the Total Environment, 262(3), 201–204.CrossRefGoogle Scholar
  13. Dobbertin, M. (2005). Tree growth as indicator of tree vitality and of tree reaction to environmental stress: A review. European Journal of Forest Research, 124(4), 319–333.CrossRefGoogle Scholar
  14. Evans, J. (2005). Growth rates over four rotations of pine in Swaziland. International Forestry Review, 7(4), 305–310.CrossRefGoogle Scholar
  15. Franklin, J. F., Norris, L. A., Berg, D. R., & Smith, G. R. (1999). The history of DEMO: an experiment in regeneration harvest of Northwestern forest ecosystems. Northwest Science, 73, 3–11.Google Scholar
  16. Griess, V. C., & Knoke, T. (2011). Growth performance, wind-throw, insects-meta-analyses of parameters influencing performance of mixed Species stands in boreal and northern temperate biomes. Revue canadienne de recherche forestière, 41(6), 1141–1159.CrossRefGoogle Scholar
  17. Halpern, C. B., Evans, S. A., Nelson, C. R., McKenzie, D., Liguori, D. A., Hibbs, D. E., & Halaj, M. G. (1999). Response of forest vegetation to varying levels and patterns of green-tree retention: An overview of a long-term experiment. Northwest Science, 73, 27–44.Google Scholar
  18. Hanewinkel, M., Cullmann, D. A., Schelhaas, M. J., Nabuurs, G. J., & Zimmermann, N. E. (2013). Climate change may cause severe loss in the economic value of European forest land. Nature Climate Change, 3, 203–207.CrossRefGoogle Scholar
  19. Heres, A.-M., Martinez-Vilalta, J., & Claramunt Lopez, B. (2012). Growth patterns in relation to drought-induced mortality at two scots pine (Pinus sylvestris L.) sites in NE Iberian peninsula. Trees, 26(2), 621–630.CrossRefGoogle Scholar
  20. Hogg, E. T., Brandt, J. P., & Kochtubajda, B. (2005). Factors affecting interannual variation in growth of western Canadian aspen forests during 1951–2000. Canadian Journal of Forest Research, 35(3), 610–622.CrossRefGoogle Scholar
  21. Iverson, L. R., Prasad, A., & Schwartz, M. W. (1999). Modeling potential future individual tree-species distribution in the eastern United States under a climate change scenario: A case study with Pinus virginiana. Ecological Modelling, 115, 77–93.CrossRefGoogle Scholar
  22. Jacobsen, J. B., & Thorsen, B. J. (2003). A Danish example of optimal thinning strategies in mixed-species forest under changing growth conditions caused by climate change. Forest Ecology and Management, 180(1–3), 375–388.CrossRefGoogle Scholar
  23. Kelty, M.J. (1992). Comparative productivity of monocultures and mixed-species stands, In The ecology and silviculture of mixed-species forests, Kluwer Academic Publishers, 31 Mar 1992.Google Scholar
  24. Knapp, P. A., Soulé, P. T., & Grissino-Mayer, H. D. (2001). Detecting potential regional effects of increased atmospheric CO2 on growth rates of western juniper. Global Change Biology, 7(8), 903–917.CrossRefGoogle Scholar
  25. Knoke, T. (2008). Mixed forests and finance—Methodological approaches. Ecological Economics, 65, 590–601.CrossRefGoogle Scholar
  26. Knoke, T., Stimm, B., Ammer, C., & Moog, M. (2005). Mixed forests reconsidered: A forest economics contribution on an ecological concept. Forest Ecology and Management, 213, 102–116.CrossRefGoogle Scholar
  27. Knoke, T., Ammer, C., Stimm, B., & Mosandl, R. (2008). Admixing broadleaved to coniferous tree species: A review on yield, ecological stability and economics. European Journal of Forest Research, 127(2), 89–101.CrossRefGoogle Scholar
  28. Legay, M., Cordonnier, T., & Dhôte, J. F. (2008). Des forêts mélangées pour composer avec les changements climatiques. Revue Forestière Française LX, 2, 181–190.Google Scholar
  29. Lindner, M., Maroschek, M., Netherer, S., Kremer, A., Barbati, A., Garcia-Gonzalo, J., Seidl, R., Delzon, S., Corona, P., Kolström, M., Lexer, M. J., & Marchetti, M. (2010). Climate change impacts, adaptive capacity, and vulnerability of European forest ecosystems. Forest Ecology and Management, 259(4), 698–709.Google Scholar
  30. Linares, J., & Camarero, J. (2012). Growth patterns and sensitivity to climate predict silver fir decline in the Spanish pyrenees. European Journal of Forest Research, 131(4), 1001–1012.CrossRefGoogle Scholar
  31. Lu, H. C., & Buongiorno, J. (1993). Long- and short-term effects of alternative cutting regimes on economic returns and ecological diversity in mixed-species forests. Forest Ecology and Management, 58(3–4), 173–192.CrossRefGoogle Scholar
  32. McDowell, N., Allen, C. D., & Marshall, L. (2010). Growth, carbon-isotope discrimination, and drought-associated mortality across a Pinus ponderosa elevational transect. Global Change Biology, 16, 399–415.CrossRefGoogle Scholar
  33. Markowitz, H. (1952). Portfolio selection. Journal of Finance, 7, 77–91.Google Scholar
  34. Markowitz, H. (1959). Portfolio selection: Efficient diversification of investments. New York: Wiley.Google Scholar
  35. Mayer, P., Brang, P., Dobbertin, M., Hallenbarter, D., Renaud, J. P., Walthert, L., & Zimmermann, S. (2005). Forest storm damage is more frequent on acidic soils. Annals of Forest Science, 62, 303–311.Google Scholar
  36. Millar, C. I., Stephenson, N. L., & Stephens, S. L. (2007). Climate change and the forests of the future: Managing in the face of uncertainty. Ecological Applications, 17(8), 2145–2151.CrossRefGoogle Scholar
  37. Morin, X., Fahse, L., Scherer-Lorenzen, M., & Bugmann, H. (2011). Tree species richness promotes productivity in European temperate forests through a strong complementarity between species. Ecology Letters, 14, 1211–1219.CrossRefGoogle Scholar
  38. Morneau, F., Duprez, C., & Hervé, J. C. (2008). Les forêts mélangées en France métropolitaine, caractérisation à partir des résultats de l’Inventaire Forestier National. Revue Forestière Française, 2, 107–120.Google Scholar
  39. Neuner, S., Beinhofer, B., & Knoke, T. (2013). The optimal tree species composition for a private forest enterprise—Applying the theory of portfolio selection. Scandinavian Journal of Forest Research, 28(1), 38–48.CrossRefGoogle Scholar
  40. Nichols, J. D., Bristow, M., & Vanclay, K. K. (2006). Mixed-species plantations: Prospects and challenges. Forest Ecology and Management, 233(2–3), 383–390.CrossRefGoogle Scholar
  41. Office National des Forêts. (2013). Chiffres-clés en Lorraine. ONF. [Online]. Retrieved August 19, 2013, from
  42. Ogle, K., Whitham, T. G., & Cobb, N. S. (2000). Tree-ring variation in pinyon predicts likelihood of death following severe drought. Ecology, 81(11), 3237–3243.CrossRefGoogle Scholar
  43. Powers, R. F. (1999). On the sustainable productivity of planted forests. New Forests, 17, 263–306.CrossRefGoogle Scholar
  44. Robert, N., Vidal, C., Colin, A., Hervé, J. C., Hamza, N., & Cluzeau, C. (2010). France. In E. Tomppo, T. Gschwantner, M. Lawrence, & R. E. McRoberts (Eds.), National forest inventories pathways for common reporting (pp. 207–221). Heidelberg: Springer.Google Scholar
  45. Roessiger, J., Griess, V. C., & Knoke, T. (2011). May risk aversion lead to near-natural forestry? A simulation study. Forestry, 84(5), 527–537.CrossRefGoogle Scholar
  46. Roman-Amat, B. (2007). Préparer les forêts françaises au changement climatique. Rapport à MM. Les Ministères de l’Agriculture et de la Pêche et de l’Ecologie, du Développement et de l’Aménagement Durables, December.Google Scholar
  47. Schou, E., Jacobsen, J. B., & Kristensen, K. L. (2012). An economic evaluation of strategies for transforming even-aged into near-natural forestry in a conifer-dominated forest in Denmark. Forest Policy and Economics, 20, 89–98.CrossRefGoogle Scholar
  48. Schütz, J. P., Götz, M., Schmid, W., & Mandallaz, D. (2006). Vulnerability of spruce (Picea abies) and beech (Fagus sylvatica) forest stands to storms and consequences for silviculture. European Journal of Forest Research, 125, 291–302.CrossRefGoogle Scholar
  49. Slimani, S., Derridj, A., & Gutiérrez, E. (2014). Ecological response of Cedrus atlantica to climate variability in the Massif of Guetiane (Algeria). Forest Systems, 23(3), 448–460.CrossRefGoogle Scholar
  50. Soulé, P. T., & Knapp, P. A. (2006). Radial growth rate increases in naturally occurring ponderosa pine trees: A late-20th century \({\rm CO}_2\) fertilization effect? New Phytologist, 171(2), 379–390.CrossRefGoogle Scholar
  51. Spiecker, H. (2000). Growth of Norway spruce under changing environmental conditions in Europe. In E. Klimo, H. Hager, & J. Kylhavy (Eds.), Spruce monocultures in Central Europe—Problems and prospects, EFI proceedings, no. 33.Google Scholar
  52. Suarez, M. L., Ghermandi, L., & Kitzberger, T. (2004). Factors predisposing episodic drought-induced tree mortality in Nothofagus-site, climatic sensitivity and growth trends. Journal of Ecology, 92(6), 954–966.CrossRefGoogle Scholar
  53. Tilman, D., Knops, J., Wedin, D., Reich, P., Ritchie, M., & Siemann, E. (1997a). The influence of functional diversity and composition on ecosystem processes. Science, 277(5330), 1300–1302.CrossRefGoogle Scholar
  54. Tilman, D., Lehman, C., & Thomson, K. (1997b). Plant diversity and ecosystem productivity: Theoretical considerations. Proceedings of the National Academy of Sciences, 94, 1857–1861.CrossRefGoogle Scholar
  55. Thomson, T. A. (1991). Efficient combinations of timber and financial market investments in single-period and multiperiod portfolios. Forest Science, 37, 461–480.Google Scholar
  56. Vettenranta, J. (1996). Effect of species composition on economic return in a mixed stand of Norway spruce and Scots pine. Silva Fennica, 30(1), 47–60.CrossRefGoogle Scholar
  57. Vivin, P., Aussenac, G., & Levy, G. (1993). Differences in drought resistance among 3 deciduous oak species grown in large boxes. Annals of Forest Science, 6, 571–582.Google Scholar
  58. Walker, K. V., Davis, M. B., & Sugita, S. (2002). Climate change and shifts in potential tree species range limits in the Great Lakes Region. Journal of Freat Lakes Research, 28, 555–567.CrossRefGoogle Scholar

Copyright information

© Springer Science+Business Media New York 2017

Authors and Affiliations

  • Marielle Brunette
    • 1
  • Arnaud Dragicevic
    • 1
    • 2
  • Jonathan Lenglet
    • 1
  • Alexandra Niedzwiedz
    • 1
  • Vincent Badeau
    • 3
  • Jean-Luc Dupouey
    • 3
  1. 1.LEF, AgroParisTech, INRANancyFrance
  2. 2.Istanbul Technical University [ITU, Department of Economics]IstanbulTurkey
  3. 3.EEF, Lorraine University, INRAChampenouxFrance

Personalised recommendations