NET PRESENT VALUE AS AN INDICATOR OF ECONOMIC EFFICIENCY IN FORESTRY
The article explains the use of the net present value for the evaluation of the effectiveness of forest management strategies for specific sites. In Russian practice, this indicator is mainly used for the evaluation of investment projects, but in forestry developed countries such as Finland and Canada for several decades now this index is used to evaluate the effectiveness of management of forest areas and planning for logging and reforestation on them. This is due to the fact that in the forestry sector, as well as in investment projects a great role is played by the factor of time, i. e. flows of revenues and expenses can be considerably spaced apart in time. This means that the use of indicators such as net income, profit, profitability, etc. do not allow to obtain complete information and give distorted results, as the time factor is not taken into account. Using an integrated model of economic evaluation in the context of strategies may also lead to an increase in the volume of selective logging, because their benefits can be assessed more clearly.
Keywords: net present value, forestry, forest income, discounting strategy of forestry, forest planning, harvesting forest plantations
References:
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Issue: 5, 2015
Series of issue: Issue 5
Rubric: SECTORAL ECONOMICS
Pages: 48 — 51
Downloads: 1099