Forest Land Expectation Value or Maximum Sustained Yield? Resolving A Long-Standing Paradox

The Faustmann formula, equivalent to the land expectation value (LEV), yields present value, starting with bare land, of an infinite series future timber rotations for a stand. If this formula is used find rotation age that maximizes lower annual harvest will result when compared maximum sustained yield (MSY) regime ownership many stands. However, LEV strongly preferred by economists. This vs. rents paradox. Herein, paper demonstrates harvests under even flow regime, discounted using any interest rate, provide same optimal as time peak MAI single stand, though different estimates profitability, depending on rate. Thus, producing MSY and financial return are identical analyzed at scale but not based analysis stand (LEV). solution formulas internal rate (IRR) valuation transaction purposes also presented.