Optimal Forest Rotation Age for Carbon Sequestration and Biodiversity Conservation by Farm Income Levels

35 Pages Posted: 30 Sep 2016

See all articles by Trung Thanh Nguyen

Trung Thanh Nguyen

Leibniz Universität Hannover

Nhung Nghiem

University of Otago - University of Otago Wellington

Date Written: September 29, 2016

Abstract

This study aimed to estimate the optimal forest rotation age for tropical plantations of a native tree species, Canarium album (Lour.) under the management of high, medium, and low income groups of farm households of Vietnam. The results suggest that:

(i) the optimal rotation age for the low income group is longer than that for the high income group;

(ii) low income farmers are more sensitive in terms of the land expectation value to changes in discount rate;

(iii) low income farmers gain less if the carbon price increases; and

(iv) the carbon payment scheme at the start of a rotation is more financially attractive to forest farmers, but the carbon payment scheme at the end of a rotation is more advantageous in terms of forest biodiversity.

These findings lead to potential policy implications for forest management for the provision of multiple ecosystem services in the context of a developing country, demonstrating a trade off between forest income and biodiversity conservation. While an increase in carbon prices would benefit forest farmers, we also suggest that these farmers could be compensated for their income losses or rewarded to maintain or increase forest biodiversity. However, relatively greater attention could be paid to compensating low income farmers as they potentially lose more with an increase in discount rate and gain less with an increase in carbon price.

Keywords: biodiversity conservation policy, carbon sequestration, farm income levels, minimum viable population (MVP), multiple-stand forests

Suggested Citation

Nguyen, Trung Thanh and Nghiem, Nhung, Optimal Forest Rotation Age for Carbon Sequestration and Biodiversity Conservation by Farm Income Levels (September 29, 2016). Available at SSRN: https://ssrn.com/abstract=2845231 or http://dx.doi.org/10.2139/ssrn.2845231

Trung Thanh Nguyen (Contact Author)

Leibniz Universität Hannover ( email )

Welfengarten 1
D-30167 Hannover, 30167
Germany

Nhung Nghiem

University of Otago - University of Otago Wellington

Wellington
New Zealand

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