| Abstract: | ABSTRACT. This paper extends the Hartman model to study the optimal rotation age of two interdependent stands at the steady state, when the rotation ages of the two stands are equal and the stream of amenities produced from the two stands may be complements or substitutes, both in space and over time. In the presence of stand interdependence both the ownership structure and the sequence of decision making matters. Rotation age choices are examined and compared under a variety of equilibria, including Nash, Stackelberg and sole owner cases. We show that the sole owner's rotation age is longer than the rotation age under both Nash and Stackelberg assumptions if the stands are spatial complements but shorter if they are spatial substitutes. The precise relationship between the Nash and Stackelberg rotation ages and the qualitative properties of rotation ages in terms of timber prices, regeneration costs and interest rates also depend on how spatial substitutability and complementarity between stands evolves through time. |
