We found a match
Your institution may have access to this item. Find your institution then sign in to continue.
- Title
An Optimal Management Strategy of Carbon Forestry with a Stochastic Price.
- Authors
Yoo, Sora; Cho, Yong-sung; Park, Hojeong
- Abstract
An analysis for the value of carbon forestry needs to be provided for the successful establishment of the carbon offset market in Korea. We present an optimal management strategy for a forest owner who participates in the offset market. Given a stochastic process of the timber price following a geometric Brownian motion, the profit maximization problem of the forest owner is solved. The model finds an optimal harvest time in the presence of the carbon and timber revenues with opposing time effects. Sensitivity analysis is performed with respect to the volatility rate of the timber price and the discount rate. The presented model is applied to the study of the Korean larch case to identify the threshold timber price above which it is optimal to harvest trees.
- Subjects
SOUTH Korea; CARBON offsetting; FORESTS &; forestry; TIMBER; PRICES
- Publication
Sustainability (2071-1050), 2018, Vol 10, Issue 9, p3290
- ISSN
2071-1050
- Publication type
Article
- DOI
10.3390/su10093290