Theories about uncertainty usually focus on its reduction. However, a significant source of uncertainty lies in the innovative and creative capabilities of the human mind. This particular source entangles us in contradictions: both reducing and creating uncertainty simultaneously. Therefore, a theory of uncertainty that solely investigates ways to reduce it is incomplete. It must be complemented by aspects of how uncertainty contributes the betterment of people.In our study, we establish a foundation for extending the theory of uncertainty in five steps. Drawing on the insights of William A. Duerr and Jean B. Duerr, who assert that faith, rather than measureable facts, guides forest resource management under uncertainty, we concentrate our analysis on informal institutions, customs, traditions etc.Firstly, we reconstruct the evolution of the internal culture of forestry. Secondly, we delineate the bourgeois culture and compare it with the internal culture of forestry. Thirdly, we develop a theoretical approach to the re-valuation of uncertainty. Fourthly, we combine the theoretical approach with a historical analysis of the Great Enrichment to provide a comprehensive understanding of an overall picture how people re-valuated uncertainty. This involves placing higher value on the chances of self-induced unforeseen changes higher than on the associated dangers. Finally, we summarize our findings and close the paper with suggestions for future research on the extension of a theory of uncertainty.

A significant segment of the variety of forest ecosystem services is neither demanded nor supplied through market exchange, but is provided essentially through political processes. In this paper, we present an economic analysis of forest stand management under consideration of politically provided ecosystem services. In this, competition between pressure groups seeking to grasp privileges plays an important role. We extend the Hartman model with elements of the pressure group models. We incorporate the amount of the reward derived from the political contest, the effectiveness factor of the forest owner in the political competition and the lobbying investment made by the forest owner. We show that the competition amongst pressure groups has a profound impact on the optimal rotation length compared to the classical solution by Faustmann. We discuss, how the competition amongst pressure groups shapes the optimal rotation length when forest stand management provides multiple forest ecosystem services. We also address the levels of the reward derived from the political contest and the effectiveness factor in the context of the urban-rural interface.

Due to their high degree of heterogeneity, mixed forest plantations give rise to numerous questions regarding the economic feasibility of this type of forest management. We simulated the growth of loblolly pine mixed in various proportions with white oak and sweetgum (75–25%, 50–50%, and 25%–75%), two commercially important hardwood species of the southeastern United States, to obtain a better understanding of the optimality of mixed plantation management. The most relevant result was that, in all scenarios, the maximum land expectation values of mixed plantations are higher than the maximum land expectation values of monoculture plantations established for timber production only, and for plantations managed for combined timber production and carbon sequestration. Economically, the optimal mixed forest plantation scenario contains 1125 loblolly pine trees and 375 sweetgum trees per hectare. We identified the density effect between the loblolly pine trees within the mixed plantations as the main factor driving the value of mixed plantations. The mixed white oak and sweetgum trees also increased the maximum land expectation values of the mixed stands in comparison to the less dense monoculture loblolly pine stands. This implies that the incorporation of hardwoods adds timber, but the trees do not represent a substitute for pine. Our analysis showed that mixed forest plantations can be a feasible economic option to diversify the production of timber in the region.

Due to their high degree of heterogeneity, mixed forest plantations give rise to numerous questions regarding the economic feasibility of this type of forest management. We simulated the growth of loblolly pine mixed in various proportions with white oak and sweetgum, two commercially important hardwood species of the southeastern United States, to obtain a better understanding of the optimality of mixed plantation management. The most relevant result was that, in all scenarios, the maximum land expectation values of mixed plantations are higher than the maximum land expectation values of pure plantations established for timber production only, and for plantations managed for combined timber production and carbon sequestration. We identified the density effect between the loblolly pine trees within the mixed plantations as the main factor driving the value of mixed plantations. The mixed white oak and sweetgum trees also increased the maximum land expectation values of the mixed stands in comparison to the less dense pure loblolly pine stands. This implies that the incorporation of hardwoods adds timber but the trees do not represent a substitute for pine. Our analysis showed that mixed forest plantations can be a feasible economic option to diversify the production of timber in the region.

A harvest scheduling model when the natural risk is not only dependent on the age of the forest stand but also on the stock density is presented in this paper. In addition, damages to human lives, human health and infrastructure caused by natural risks are incorporated. Using a conditional current value approach, the optimal thinning and rotation length conditions are determined and used for the qualitative analysis of the course of the optimal volume path under different risks. Also the impacts of external variables such as stand age, interest rate, timber price and damages to human lives etc. to the optimal harvest schedules are derived. The results and dependencies are discussed in detail and compared to findings presented in the literature.

Tactical harvest scheduling is related to forest unit selection and spatial sequencing. Mixed Integer Linear Programming (MILP) is traditionally implemented in this type of planning, associating each forest unit with one or more binary and/or integer variables. However, the higher number of binary/integer variables used in a model, the higher complexity and processing time to find an optimal solution. Given the need for improvements in computational performance, heuristic methods may present computational advantages to determine a feasible solution. In this context, the objective of this study was to solve a harvesting plan that aggregates adjacent stands to create blocks through the application of MILP and three different strategies of the Relax-and-Fix (R&F) heuristic. For that purpose, we used a hypothetical 1153-ha forest, subdivided into 100 stands of Pinus taeda L., as a database. The application of R&F, in general, proved to be efficient, especially when the R&F Backward solution was applied as an initial solution of the exact model. This scenario produced the best result of the study: a 28% decrease in computational time and the same spatial sequencing of stands as the MILP model.

In this paper the politics of biodiversity is analysed. Biodiversity is identified as being an ideological key symbol within the expressive space of politics. Whereas individuals express themselves, their core beliefs, their ideologies, etc. for their own sake, political parties and nature conservation organisations use biodiversity to garner seats in parliament, private donations and membership fees. The success of biodiversity in stimulating expressive benefits induces co-occurrence between nature conservation organisations in the expressive space and ordinary pressure groups on the substantive floor. Co-occurrence boosts the effectiveness of both types of organisation and adjusts the results between the expressive space and the substantive floor. As a result, nature conservation organisations receive donations from ordinary pressure groups and obtain legislative and budgetary privileges. Without co-occurrence it would be difficult to sustain the various activities of nature conservation organisations. The implications of the findings are, first, that biodiversity is input- rather than outcome-oriented; it supports democracy as an impersonal social institution helping to find the overall consensus. Second in many specific forest management decisions expressive and instrumental concerns are not clearly distinguished. Where citizens place an emphasis on instrumental values there must be a strong case in favour of robust decentralized arrangements of political choice. Third, projects with very high expressive and low instrumental values are at best provided at the voluntary arena of the expressive space.

Presented in the paper is an analysis of the pure land allocation when a land use change affects the prices paid for goods and production factors in different ways. Three different models are presented: a fully open economy, a closed economy and an economy where selected prices are exogenously determined. The reaction in terms of land allocation occurs in an intuitive manner only in the case of certain market conditions. In more complex situations, no general prediction of the land use change is possible. The introduction of policy programmes to boost forestry has different effects in open and partially open economies. Therefore, the different channels by which the prices of goods and factors determine the allocation of land are identified. This approach allows for the formulation of specifications permitting a grouping of economies with different market structures into classes with equal land allocation patterns.

The aim behind this paper was to find a logical explanation for the simultaneous existence of public and private timber enterprises based on an individual, subjective benefit-cost weighting made in the context of different institutional arrangements. In the section on modeling, the effects of the separation of forest ownership and forest management, and of private and public ownership sharing are studied. The main difference between public and private timber enterprises relates to the exit clause. Whereas public timber production is characterized by a strong exit clause, in the case of private timber enterprises the individual stockholder can exit almost without constraint. The strong exit clause in public enterprises increases the liability as technique for hedging the risks of timber production. This becomes more pronounced the greater the degree to which the public fiscal decision is separated into a production and a liability decision. The reason for this is that where there is a higher degree of public decision making an unconstrained majority rule applies, which also leads to a transfer of liability to a minority. Another factor is that the limited time perspective involved in public choices does not outperform the advantage of lower interest rates associated with public timber production. The strong exit clause in public timber enterprises also provides an opportunity for the forest manager to increase the forest rotation length. The paper concludes with some remarks on how the results obtained from the simple public choice model employed in the study are applicable to a representative democracy.

The paper provides an overview of the papers included in this special issue, and presents thoughts about New Frontiers of Forest Economics. The paper argues that science does not mean analysis alone; it should be complemented by synthesis and forest economics is a promising field to rediscover synthesis as a methodology of science. The paper sets the goal of boundless profession of forest economics and suggests three key areas of research: (i) economic models that interweave other-regarding and non-cooperative self-interest preferences; (ii) rigorous analysis and synthesis of externalities and development of new economic approaches to address the diversity of interrelated property rights of complex ecosystems; and (iii) treating markets and political institutions as entangled institutions.

Storm events shorten the optimal rotation compared with the classical Faustmann solution.When the neighbourhood-protection-effect changes simultaneously with site productivity and site-related arrival rates, analyses in such complex environments involve numerous, qualitatively ambiguous effects that ask for empirical escorts. We use empirical material from the Ore Mountains (Germany), where storm damages were analysed between 1831 and 1981. The calculated results show the complex interweavements of the different factors concerning storm risk. The multiple effects under storm risk ask for specific forest management strategies, which cannot be found intuitively: more complex analyses need support of economic calculations. (C) 2014 Department of Forest Economics, Swedish University of Agricultural Sciences, Umed. Published by Elsevier GmbH. All rights reserved.

A planting and timber harvest scheduling model for even-aged forest stands was developed by combining and extending the dynamic thinning approach and existing work on planting density. A net present value maximum solution for planted volume, thinning regime and rotation schedule was determined simultaneously. The influence of the planting density on the optimal stand volume path, thinning schedule and rotation length was analyzed, emphasizing the importance of optimal stand establishment. The results and dependencies are discussed in detail and compared to findings presented in the literature.

This special issue of Forest Policy and Economics is based on the papers presented and discussions held at the International Conference on the New Frontiers of Forest Economics, June 26–30, 2012 held at ETH, Zurich, Switzerland. This paper discusses the need of new frontiers of forest economics, provides an overview of the special issue, and presents thoughts about new frontiers. The paper suggests that all knowledge of forest economists is conjectural, and without the competition of contradictorily theories forest economics sinks into intellectual poverty. The progress of forest economics will need a never ending fabrication on new and venturous theories for solving problems and strong attempts to refute, to critically assess and discuss, and to test empirically the new theories. The paper discusses three areas for new frontiers of forest economics — integration of sciences using multidisciplinary and transdisciplinary approaches, incorporation and integration of various streams of economics, and answering the unanswered questions by developing new models and methods.

Forestry is not an entity. Forestry includes countless and complex types of human interactions concerning forests. Humans have found complex and nearly endlessly diverse institutional structures. Differences in the results of interactions are often caused by different institutional structures. Economic theories as explanations of human interactions are not detached from institutional structures. Their predictions are only valid in these institutional settings.

The allocation of rights of access to forests as an example of the problem of social cost (essay) This paper analyses the allocation of rights of access to forests in Switzerland. The starting point is the fact that free access to forests, such as is seen in Switzerland, is leading to an increase in the use of forests for recreation and subsequent competition with other rights of forest use. A four-stage analysis is implemented in this paper. In the first stage, the well-known farmer-rancher-approach proposed by Coase is applied in order to explain the conflict of use between the two groups, recreational forest users and forest owners. In the second stage, the number of conflicts of use is multiplied by dividing the recreational forest users into subgroups and adding further user groups, such as hunters or nature conservationists. The observed conflicts of use and the solutions with regard to rights of access to forests are very diverse, specific and subject to spatial variability. Since all solutions incur transaction costs, these are the focus of the third stage of the paper. The cost of political and bureaucratic coordination is given special consideration, since this is where Buchanan says the allocation of transaction costs takes on a special dimension, namely, the gradual loss of individual rights, caused by the growth of bureaucracy and politically motivated interests. Thus, the fourth and final stage suggests stronger use of civil law options in solving conflicts of use involving access to forests, since civil law is based on historic and evolutionary rules of just conduct. These rules, in which private and public property is managed by associations, have evolved over a long period of time and are strongly anchored in the common heritage of Swiss society.

In this paper, it is shown that Pressler's indicator rate formula is also the optimal condition for the determination of the optimal harvest age under the generalized Faustmann formula. In addition, a modern treatment of the quantity increment, quality increment, and price increment is presented. Pressler's indicator rate formula is then applied to determine the optimal harvest age in a dynamic world of unanticipated changes.

Although intensive managed plantations clearly increase the growth and yield of forests several papers refer to declining forest productivity. Therefore in this paper we study the impact of declining forest productivity on the land expectation value and the optimal rotation length. We start from the research by Lu and Chang (1996) and try to fill the gap between the stable site productivity (“best”) and the site mining (“worst”) cases. For that we extend the classical Faustmann model by availability of different recovering technologies. In general the model allows the analysis of the two plantation groups: “mining the site by high productive plantation followed by management of degraded areas” and “high productive plantation and regeneration cycling” with the same comparative static. The model, analysis and comparison with the two extreme cases in Lu and Chang (1996) leads to a detailed understanding of land use management when site productivity decline is possible. Particularly the relation between declining periods with intensive land use and land use alternatives after declining periods with regeneration can be well understood. Findings are: Not ever declining process asks for regeneration. Many declining processes can be stopped at early times by high cash flows after mining periods. Shortenings of the regeneration time can boost site mining intensities.