A NOTE ON HIGH DISCOUNT RATES AND DEPLETION OF PRIMARY FORESTS
By: Bulte, Erwin H.; van Soest, Daan P.
Bulte, Erwin H.; van Soest, Daan P., A NOTE ON HIGH DISCOUNT RATES AND DEPLETION OF PRIMARY FORESTS, Journal of Agricultural and Resource Economics, Volume 21, Issue 2, December 1996, Pages 341-350
Conventional wisdom implies that high discount rates accelerate depletion of tropical forests. As shown in this article, this result does not necessarily hold in a two-state variable model that distinguishes between primary and secondary forest stocks. In the context of a fixed concession period and imperfect government control, logging of primary forests may be both accelerated and depressed as discount rates increase.