Publication
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Publication
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The conventional forest investment assessment at the stand level has difficulty dealing with multiple decisions and capturing the operational flexibility involved in timber production. By combining forest-level analysis with the options valuation approach, this article suggests a new framework for forestry investment assessment. We first articular the new framework and discuss a few technical issues encountered in adopting it. Then, we present three empirical examples (entry decision, land acquisition, and harvest timing) to illustrate how forest-level analysis and/or real options valuation can be done and what we may learn from this type of exercise. We believe that while adopting this new framework entails challenges, it represents a great opportunity to expand the field of forest investment assessment.
Fiscal Year: 2002 ·
Problem Area: pa98-1 ·
Theme: cctsopin ·
Source: extra
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Citation:
Yin, R. 2001. Combining forest-level analysis with options valuation approach--a new framework for assessing forestry investment. Forest Science 47(4):475-483. Want more? Send an email to dwear@fs.fed.us
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Forest Economics and Policy |
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USDA Forest Service Southern Research Station |