COST-BENEFIT ANALYSIS OF ESTABLISHMENT OF SCOTS PINE, AUSTRIAN PINE AND SPRUCE FOREST PLANTATIONS

The cost-benefit analysis, which contributes to finding best solutions and helps in making decision on acceptability of treatment, has been used as an instrument in the assessment of afforestation impact on the environment. It has been established that a cost-effective investment into Scots pine, Austrian pine and Spruce afforestation is viable solely on the basis of wood production. Wood production, depending on tree species and soil quality, can bear even slightly higher interest rates in the areas of good soil quality in comparison to previous estimates, which mostly ranged around 3%. In the areas of poor soil quality, the interest rates can drop even below the 3% rate. At lower discount rates, the breakeven point is extended in time, whereas at higher discount rates, it is shortened. The length of production cycle performs an important role in determining the costeffectiveness of an investment, particularly from the aspect of the relation between the length of production cycle and production purposes (type and quality of wood assortments that are produced). Based on the analysis of non-quantifiable benefits and costs, it has been established that the benefits surpass the costs, therefore, afforestation projects can be acceptable.


Variant title:
ANALIZA RENTABILNOSTI PODIZANJA ŠUMSKIH PLANTAŽA BELOG BORA, CRNOG BORA I SMRČE
Editor(s):
Cvijanovic, Drago
Issue Date:
2013-10
Publication Type:
Journal Article
DOI and Other Identifiers:
UDC 338.43:63 CIP 33:63(497.11) ISSN 0352-3462 COBISS.SR-ID 27671 (Other)
Record Identifier:
http://ageconsearch.umn.edu/record/158259
PURL Identifier:
http://purl.umn.edu/158259
Published in:
Volume 60, Number 3
Economics of Agriculture
Page range:
609-622
Total Pages:
14
JEL Codes:
Q57
Note:
Review Article
Series Statement:
Economics of Agriculture 2/2013
UDC: UDC:658.155:630*2




 Record created 2017-04-01, last modified 2018-01-22

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