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Did Pressler fully understand how to use the indicator per cent?
Department of Forest Economics, SLU, SE-901 83 Umeå, Sweden.
Umeå University, Faculty of Social Sciences, Department of Economics.
2010 (English)In: Journal of Forest Economics, ISSN 1104-6899, E-ISSN 1618-1530, Vol. 16, no 3, 195-203 p.Article in journal (Refereed) Published
Abstract [en]

A classical problem in forest economics is the determination of the optimal rotation age. It is commonly acknowledged that Martin Faustmann and Max Robert Pressler contributed the most to the solution of this problem. Faustmann formulated the renowned land expectation value formula, which laid the foundation for economic analyses of the optimal rotation problem. He also provided several hints on how to correctly solve the problem. Pressler's work focused on the growth of the capital in a forest stand. He invented the concept of Indicator Per Cent, and argued that the Indicator Per Cent should be used to guide forestry decision-making. Pressler correctly stated how to use the Indicator Per Cent to determine when a stand should be harvested. However, his suggestions about the choice among silviculture options indicate that he did not fully understand the economic implication of the Indicator Per Cent.

Place, publisher, year, edition, pages
Elsevier, 2010. Vol. 16, no 3, 195-203 p.
Keyword [en]
Optimal rotation age, Forest economic history, Faustmann, Pressler
National Category
Economics
Research subject
Economics
Identifiers
URN: urn:nbn:se:umu:diva-26817DOI: 10.1016/j.jfe.2009.11.004ISI: 000282035500003OAI: oai:DiVA.org:umu-26817DiVA: diva2:274225
Available from: 2009-10-27 Created: 2009-10-27 Last updated: 2015-10-09Bibliographically approved

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Löfgren, Karl-Gustaf

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