Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
6545124 | Journal of Forest Economics | 2018 | 12 Pages |
Abstract
Several national governments now require the discount rate for public projects with long planning horizons to decrease over the life of a project. Theoretical results that characterize the impacts of a declining discount rate on optimal harvest age and land expectation values in the Faustmann Model are presented. New results include: derivation of conditions for a sequences of optimal harvest ages and land expectation values, comparative statics results, conditions that must be satisfied for multiple optima, and proof that harvesting is never optimal immediately before a discrete decrease in the discount rate.
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Authors
Richard J. Brazee,