The course provides knowledge about economic theories (micro and macroeconomics) applied to forest processes; besides about forest enterprises' choices in the short and long term, demand and supply of forest products, the principles of market functioning, analysis of international, national and local wood market .
I. Bernetti, S. Romano (a cura di), Economia delle risorse forestali (Vol I e II), Liguori Ed., Napoli, 2007
M. Merlo, Elementi di Economia ed Estimo Forestale-Ambientale, Patron Ed., Padova, 1992
D. Pettenella, Le nuove sfide per il settore forestale. Mercato, Energia, Ambiente e Politiche, 2009
A. Tirinnanzi e Fagarazzi C.(a cura di), Strumenti per lo sviluppo di filiere biomassa energia di qualità, Biglia editore, 2015.
Learning Objectives
Provide the basic knowledge to carry out economic and financial assessments in the forest area, useful for the professional activity.
Prerequisites
Mathematics exam - Analysis 1
Teaching Methods
Lectures and exercises in the classroom of financial mathematics and assessment of forest investments
Educational visits to understand the wood production phases and the relative production costs.
Further information
Educational activities include educational visits to forest companies.
Market surveys related to the sale of standing woods, semi-transformed and / or transformed wood.
Type of Assessment
The exam is divided in two phases :
1. a written test with open and closed questions and questions of financial mathematics and evaluation of investments) (valid result 1 year)
2. an oral test on the topics of the course. (You can access the oral exam after passing the written test)
Course program
Forest resources and wood market.
Demand, elasticity and revenues
- Income and consumption
-. Elasticity / cross-application
-. Changes in the demand curve
-. Overview of the demand and environment curve
Supply of forest products 1. Basic concepts
-. Production revenues and costs
-. Average and marginal costs
-. Profit Maximization
-. Kin market offer curve
Market equilibrium
- The perfect competition market
- Market balance
- Movements of the equilibrium point
- Adjustment of the equilibrium point
Timber demand and supply.
Short run timber demand and supply. Valuing nonmarket forest outputs
Financial mathematics
Interest, Simple interest regime, Compound interest regime. Periodic Values: annuities: final accumulation of limited deferred annuities; initial accumulation of limited deferred annuities; intermediate accumulation of limited deferred annuities; initial accumulation of unlimited deferred annuities; accumulation of anticipated annuities. Inverse problems for the calculation of the annuities; Periodicity and polyannuality: final, initial and intermediate accumulation of limited postponed periodicity; initial accumulation of unlimited periodicity. Inverse problems, calculation of periodicity Choice of interest rate
Evaluation of investments
Nominal end real rates of return.
Net present value and Internal rate of return, with some practical exercises. Benefit/cost ratio; payback period.
Choice of entrepreneur and forest planning
Short and long-term choices in forest production; Forest planning; the representation of entrepreneurial choices through production functions;
Analysis of economic report of the forest enterprises
Origins and purposes; Forest taxation; Partial balance sheets: value of transformation, stumpage value; budgets or periodic cultural accounts of peers (introduces numerator of the Faustman formula). Appraising market value.