arXiv subjects

Petri P. Karenlampi

Publications and source records attributed to Petri P. Karenlampi.

6 recordsLinked to original sources

arXiv2025

Darwinian spreading and quality thinning in even-aged boreal forest stands

Darwinian spreading of vigor, in addition to quality distribution, is introduced in a tree growth model. The size of any tree, within an even-aged stand, is taken as a measure of an inherited productive capacity, and then combined with quality thinning. For sparse cultivation density, the result is forestry without commercial thinnings; large trees cannot be removed since they are the most productive, neither small trees because the unit price of harvesting would be large. For large cultivation density, thinning from above becomes combined with quality thinning of large trees. Darwinian spreading of growth rate may correlate with quality. Quality thinning may enhance growth rate. Such effects combined, large trees still become removed but quality thinning becomes implemented in almost all diameter classes. At financial maturity, Darwinian spreading treated with quality thinning, the weighted mean breast height diameter is in the vicinity of 20 cm within stands of high planting density, and somewhat higher with low planting density. Quality correlating with Darwinian spreading of growth, and growth rate correlating with observed quality, trees grow bigger, the maturity size becoming closer to 25 cm - bigger than in earlier studies without tree-size - dependency of vigor.

econ.GN↗

arXiv2025

Quality thinning and value development of boreal trees on spruce-dominated stands

For the first time, quality distribution of trees is introduced in a tree growth model. Consequently, the effects of quality thinning on stand development can be investigated. Quality thinning improves the financial return in all cases studied, but the effect is small. Rotation ages, timber stocks and maturity diameters are not much affected by quality thinning. Bare land valuation neither changes the contribution of the quality thinning. The reason for the small effect apparently lies in the value development of individual trees. The relative value development of small pulpwood trunks is large, since the harvesting expense per volume unit is reduced along with size increment. Such trees are not feasible objects for quality thinning, unless quality correlates with growth rate. Another enhanced stage of value development is when pulpwood trunks turn to sawlog trunks. For large pulpwood trunks, quality thinning is feasible. Existing sawlog content in trees dilutes the effect of quality thinning on the financial return. The results change if the growth rate is positively correlated with quality, quality thinning becoming feasible in all commercial diameter classes.

econ.GN↗

arXiv2025

Complex economics of simple periodic systems

This paper investigates the financial economics of simple periodic systems. Well-established financial procedures appear to be complicated, and lead to partially biased results. Probability theory is applied, and the focus is on the finances of simple periodic growth processes, in the absence of intermediate divestments. The expected value of the profit rate, derived from accounting measures on an accrual basis, does not depend on the capitalization path. The expected value of capitalization is path dependent. Because of the path-dependent capitalization, the return rate on capital is path-dependent, and the time-average return rate on capital differs from the expected value of the return rate on capital for the growth cycle. The internal rate of return, defined through a compounding equation, is path-independent, thereby differing from the expected value of the rate of return on capital. It is shown that within a production estate, the area-average of internal rate of return is not representative of the rate of return on capital. The growth cycle length maximizing the return rate on equity is independent of market interest rate. Leverage effect enters the microeconomics of the growth processes through a separate leverage equation, where the leverage coefficient may reach positive or negative values. The leverage effect on the internal rate of return and the net present value are discussed. Both effects are solvable, resulting in incorrect estimates.

econ.GN↗

arXiv2023

Microeconomics of nitrogen fertilization in boreal carbon forestry

Nitrogen fertilization of boreal forests is investigated in terms of microeconomics, as a tool for carbon sequestration. The effects of nitrogen fertilization's timing on the return rate on capital and the expected value of the timber stock are investigated within a set of semi-fertile, spruce-dominated boreal stands, using an inventory-based growth model. Early fertilization tends to shorten rotations, reducing timber stock and carbon storage. The same applies to fertilization after the second thinning. Fertilization applied ten years before stand maturity is profitable and increases the timber stock, but the latter effect is small. Fertilization of mature stands, extending any rotation by ten years, effectively increases the carbon stock. Profitability varies but is increased by fertilization, instead of merely extending the rotation.

econ.GN↗

arXiv2023

Disturbance Effects on Financial Timberland Returns in Austria

Probability theory is applied for the effect of severe disturbances on the return rate on capital within multiannual stands growing crops. Two management regimes are discussed, rotations of even-aged plants on the one hand, and uneven-aged semi-stationary state on the other. The effect of any disturbance appears two-fold, contributing to both earnings and capitalization. Results are illustrated using data from a recently published study, regarding spruce (Picea abies) forests in Austria. The economic results differ from those of the paper where the data is presented, here indicating continuous-cover forestry is financially inferior to rotation forestry. Any severe disturbance may induce a regime shift from continuous-cover to even-aged forestry. If such a regime shift is not accepted, the disturbance losses reduce profits but do not affect capitalization, making continuous-cover forestry financially more sensitive to disturbances. Revenue from carbon rent favors the management regime with higher carbon stock. The methods introduced in this paper can be applied to any dataset, regardless of location and tree species.

econ.GN↗

arXiv2022

Two strategies for boreal forestry with goodwill in capitalization

Two strategies for boreal forestry with goodwill in estate capitalization are introduced. A strategy focusing on Real Estate (RE) is financially superior to Timber Sales (TS). The feasibility of the RE requires the presence of forest land end users in the real estate market, like insurance companies or investment trusts, and the periodic boundary condition does not apply. Commercial thinnings do not enter the RE strategy in a stand-level discussion. However, they may appear in estates with a variable age structure and enable an extension of stand rotation times.

econ.GN↗