Syllabus
FOR 3993:
Lecture: 019
Ag. Hall,
Problem Sessions: 005 Ag.
Hall,
Course Web Site:
http://blackboard.okstate.edu
Instructor: Sándor F. Tóth
Office Address:
008G Agricultural Hall
Telephone:
744-5478; Email: sandor.toth@okstate.edu;
URL: http://sandor.okstate.edu/
Instructor’s
office hours:
Course Description: This course
establishes the economic and financial foundation of forest management. We will
focus on financial analysis, microeconomic theory and multiple-criteria decision
making as tools to aid better decision making in forestry and to better
understand the motives and context for private and public forest management
decisions.
Course Objectives: By the end of the course, all students should be able to:
1. evaluate typical stand-level management decisions on a financial basis;
2. calculate the value of a forested property based on expected revenues and costs from timber production;
3. understand and apply the concepts of the land expectation value and forest value to forested properties;
4. understand the concepts of supply and demand as well as the market equilibrium in the context of timber production;
5. have a perspective on international timber trade issues;
6. evaluate the non-timber benefits of a forest; and
7. have improved problem solving, analytical and computer skills.
Textbook: Part I: Marc E. McDill.
Part II: W. David Klemperer.
Grading: Assignment Weights Notes
Homework
Assignments (6) 20% Individual work
Reading Assignments (2) 5% Individual work
Problem Sessions (12) 25% Work in groups of 4
Midterm Exam 20% Closed-book/notes
Final Exam (comprehensive) 30% Closed-book/notes
Note: The actual number of assignments might be lower but not higher.
Course Policies:
· Grading: A: 91-100%, B: 81-90%, C: 71-80%, D: 61-70%, E: 51-60%, F: <=50%. The scale might be lowered slightly but not raised.
· Missed Exams: The OSU policies will be followed to determine whether a make-up exam would be given.
· Academic Integrity Statement: Do not cheat or plagiarize! Please visit the Office of Academic Affairs’ website at http://academicintegrity.okstate.edu/ to learn what constitutes cheating or plagiarism and to find out what the consequences are if you violate the integrity policies. For more information on the University’s academic integrity policy, refer to http://academicintegrity.okstate.edu/doc/aistudenthandout.pdf
· Students with Disabilities: If you have a disability that requires special attention, please see me at my office and contact OSU’s Student Disability Services (315 Student Union, Tel.: 405-744-7116). The Student Disability Services has a web site at http://sds.okstate.edu/
Communicating with me:
Do
not hesitate to contact me outside of my office hours if you have any questions
or comments. Please send me an email or give me a call before you come to my
office. You can, and should use me as a resource to aid your learning at OSU.
Student/Instructor Responsibilities (From Marc E. McDill):
“Learning should be a cooperative venture between the students and the instructor and among the students of a class. The following lists should help clarify our roles and responsibilities. Feel free to give me your own additions or comments.
Both the Students and the Instructor:
1. Be prepared and on time for class.
2. Treat everyone in the class with respect.
Instructor:
1. Set clear expectations and provide motivation for students.
2. Select and prepare course materials, and make them readily available to students in a timely fashion.
3. Explain difficult concepts.
4. Guide discussions and problem sessions.
5. Provide fair and prompt feedback and grading.
6. Give students opportunities to provide feedback on the course and listen to their comments and suggestions.
Students:
1. Study assigned readings before class.
2. Complete all assignments on time.
3. Think for yourself and ask questions.
4. Contribute at least your share to the group assignments.
5. Give thoughtful feedback to the instructor on how to improve the course.”
Tentative Schedule /Fall 2006/
Week 1 – August 21-25
·
The Syllabus. Getting to know each other. The
context of forest economics and finance. The role of models in forestry, model
building fundamentals.
Part I:
Financial Analysis
· Introduction to discounting: present and future values, interest rates, discounting, the single value formula, infinite/finite, annual/periodic payments (MEM.Ch2).
Week 3 – September 4-8
·
Monday: University
Week 4 – September 11-15
· Financial analysis with inflation (MEM.Ch3). Discussion on discounting and future generations.
Week 5 – September 18-22
· Financial
analysis overview, Net Present Value, Benefit/Cost Ratio, and the Internal Rate
of Return. Growth and yield concepts: Periodic
and Mean Annual Increment, and the Compound Interest Rate of Growth (MEM.Ch4-5).
Week 6 – September 25-29
· The Land Expectation Value and the
financially optimal rotation. Marginal analysis of the rotation decision and
the effects of changing economic conditions (MEM.Ch6).
Week 7 – October 2-6
· The
Week 8 – October 9-13
· Monday: Fall Break. The economics of
uneven-aged management: selecting an optimal cutting cycle and residual basal
area (MEM.Ch9).
Week 9 – October 16-20
· Uneven-aged management: the single tree
decision – the concept of financial maturity (MEM.Ch9). Friday (
Part II: Forestry
in the Free Market
Week 10 – October 23-27
·
Review
of the concepts of supply and demand (WDK.Ch2).
Week 11 – October 30 - November 3
· Supply-demand equilibrium. Forests in the
free market: welfare-maximization, the role of the government, market failures (WDK.Ch2).
Week 12 – November 6-10
·
Monday
and Wednesday: No class. Friday: Valuing non-timber forest benefits (WDK.Ch14).
Week 13 – November 13-17
· Selling non-timber forest services: the
positive externalities of public goods, the carbon market, water, biodiversity,
wildlife and other forest services (WDK.Ch14). Discussion on non-timber forest services.
Week 14 – November 20-24
· The optimal timber stocking problem: optimal
planting density and optimal thinning intensity (WDK.Ch8). Friday: University
Week 15 – November 27 - December 1
· Timber supply and demand (WDK.Ch12).
Week 16 – December
4-8 (Pre-finals week)
· Summary. Review sessions.
Week 17 – December 11-15
· Final
Exam: Monday (December 11,