Formulation and selection of timber management strategies : description of the problem context and development of a methodology

Forest management involves intervening in forest system processes to control system dynamics in a manner thought to be beneficial to the forest owner. Perfect control is not possible because the system is neither closed nor deterministic. The forest manager must make decisions regarding present and future levels of use for various forest resources as well as choose the type and magnitude of system interventions to impose which will maximize the owner's expectations of present and future returns from the forest. The decision process is complicated by uncertainty about the present and future state of the forest system, present and future requirements from the system, measurement of returns and the influence of management interventions on the system dynamics. This dissertation specifically addresses the process of selecting a management strategy for the timber resource on a specific unit such as a timber supply area. As management of any one forest resource should not be imposed in total isolation from the other forest resources, the context of timber management strategy decisions within the management of the forest as a whole is examined from a decision analytical perspective. Management of the timber resource is described as consisting of two interrelated decisions: (1) what level of timber extraction to allow over time and (2) what management actions to impose in order to secure the level of timber extraction desired. These decisions are shown to be linked by projections of timber supply. Arguments are presented supporting the analytical separation of these two decision processes. Decisions governing the level of timber extraction over time must address the present and projected demands for, and returns from, different forest resources as well as the supply of timber available under different management scenarios. Selection of a timber management strategy should be made on the basis of achieving a particular harvesting level over time for a minimum cost. This decision is complicated by the uncertainty of response to any management activity. A linear programming approach to formulating timber management strategies is presented. The approach selects candidate management sequences for inclusion in a management strategy on the basis of their contribution to total cost subject to the restrictions imposed by present forest structure and future harvesting levels. Total cost is defined as the sum of the direct cost associated with implementing the management sequence and the indirect cost associated with the probability of not achieving the desired response. Indirect cost is calculated by associating subjective probabilities with potential outcomes under any management sequence and assigning benefit and cost values reflective of the degree of risk aversion to potential positive and negative deviations from the expected response. The implications and potential applications of this modelling approach are illustrated through a simple, hypothetical example. The greater the importance placed on meeting future harvest requirements, the higher the direct cost associated with implementing the strategy. Although choice of an appropriate degree of risk aversion is not an easy task, examination of strategies formulated assuming different levels of risk aversion provides insight into the sensitivity of the strategies to changes in attitudes towards risk.Forestry, Faculty ofGraduat