Risk Aversion and Timber Harvest Strategies: A Case Study of Nonindustrial Private Forest Management in Louisiana

• DOI: 10.1007/s11842-021-09498-1
• Publication Date: 2022-01-08T00:02:46Z
• Authors: Hua Wang; Naveen Adusumilli; Michael Blazier; Santosh Pathak
• Keywords: Risk Aversion

Abstract Forest owners face many challenges regarding forest management due to the long period from planting harvest. Along with economic and environmental factors that influence actions, owners' attitude risk plays a crucial role in decisions. This study shows understanding effects of owner's preference for actions is an important step form effective policy. The objectives are (1) assess advantage alternatives over range aversion coefficients (2) determine financial incentive (risk premium) corresponding attitude. We implemented stochastic efficiency respect function framework evaluate set fertilization, herbicide, thinning at mid-rotation loblolly pine plantations Louisiana. Results this indicate affects their decision select actions. Financial incentives substantially different specific between risk-neutral risk-averse owners. results can guide policy development where agencies modify assistance programs improve adoption