When developing new bio-based products and when trying to assess their market opportunities, it is indispensable to correctly calculate all expected unit costs. In this context, the provision for natural resources from primary agricultural or forest production is an important cost component. As all renewable natural resources need a certain time to grow, one needs to calculate the related capital cost and model biological growth over time to correctly account for all external and internal net benefits from natural resources. Furthermore, especially for permanent crops and woodland resources, corresponding biological growth expectations are to be combined with investment appraisal to derive optimised single and infinite rotations for different kinds of plantations. In other words, in this chapter we need to introduce both basic concepts dealing with interest calculation that is based on the existence of (economic) capital growth and with biological growth. Thus, ► Sect. 16.1 outlines basic concepts from compound interest calculation (i.e. capital growth) and illustrates reasons and ways of discounting, whereas ► Sect. 16.2 deals with simple ways to mathematically describe and simulate biological growth. Combining both approaches enables us to plan optimum resource use over time: in this context, we will identify optimum harvest (or rotation) times in forestry (► Sect. 16.3) and determine the optimum replacement time for permanent crop plantations that continuously yield yearly benefits (see ► Sect. 16.4). Our analysis will focus on private wood and crop related benefits. However, in ► Sect. 16.3 we will also briefly discuss how the inclusion of forest related positive externalities due to regulating or cultural ecosystem services will affect harvest decisions and optimum forest use over time.

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Economics of Primary Production

  • Christian Lippert

摘要

When developing new bio-based products and when trying to assess their market opportunities, it is indispensable to correctly calculate all expected unit costs. In this context, the provision for natural resources from primary agricultural or forest production is an important cost component. As all renewable natural resources need a certain time to grow, one needs to calculate the related capital cost and model biological growth over time to correctly account for all external and internal net benefits from natural resources. Furthermore, especially for permanent crops and woodland resources, corresponding biological growth expectations are to be combined with investment appraisal to derive optimised single and infinite rotations for different kinds of plantations. In other words, in this chapter we need to introduce both basic concepts dealing with interest calculation that is based on the existence of (economic) capital growth and with biological growth. Thus, ► Sect. 16.1 outlines basic concepts from compound interest calculation (i.e. capital growth) and illustrates reasons and ways of discounting, whereas ► Sect. 16.2 deals with simple ways to mathematically describe and simulate biological growth. Combining both approaches enables us to plan optimum resource use over time: in this context, we will identify optimum harvest (or rotation) times in forestry (► Sect. 16.3) and determine the optimum replacement time for permanent crop plantations that continuously yield yearly benefits (see ► Sect. 16.4). Our analysis will focus on private wood and crop related benefits. However, in ► Sect. 16.3 we will also briefly discuss how the inclusion of forest related positive externalities due to regulating or cultural ecosystem services will affect harvest decisions and optimum forest use over time.