The Fifth International Faustmann Symposium was successfully held on October 17-21 October, 2016 in Beijing, China. Forest economists from over nine countries came to present their recent work, discuss recent findings and celebrate the next 167th anniversary of the Faustmann formula.
The Faustmann Symposium history
The Faustmann Symposium tradition started at the Hunting Castle of Kranichstein near Darmstadt in Germany in 1999, where the first symposium was celebrating the 150th anniversary of the famous Faustmann formula. Before this year, all Faustmann symposia were held in Germany (1999, 2009), USA (2005) and Finland (2012).
This year was very special, as it was a first time when Faustmann Symposium was held in Asia. The 5th Symposium was hosted by School of Economics and Management, and Beijing Forestry University in China.
The Faustmann Formula
Martin Faustmann*, a German forester, embraced his considerations to forest land valuation in his seminal 1849 article. After 167 years, the Faustmann formula remains unquestioned. The formula gives a solution to the optimal forest rotation age. Every forest economist know what Faustmann formula (sometimes called also land expectation value (LEV), soil expectation value (SEV)) is. However, it is still under scientific debate who created this formula as a first one. Organizers of the 5th Symposium write on their website:
“Faustmann’s intellectual effort should not be cheapened, nevertheless, it has to be added that already König published articles in 1813 and 1835 where the thoughts underlying the Faustmann formula can be found. Moreover, suggesting a simple solution for the contentious issue of rotation period optimization is first of all thanks to Pressler. These scientific achievements are important milestones in the field of forest economics”.
However, recent findings show that the credit for Faustmann formula should be given to Johann Hossfeld, a competent forest mathematician, who in 1805 showed explicitly how forest value can be derived under both intermittent and sustained yield management. You can read more about history behind Faustmann formula, and its development here: Faustmann formula discovered before Faustmann.
The fifth Faustmann Symposium
Forest economists from countries such as China, USA, Germany, Poland, Sweden, Costa Rica, Finland, Norway, Canada or New Zealand came to participate in this big event. Conference started with very warm welcome words from Mr Yanxiang Hao (Director of the Department of Forest Resources, State Forest Administration), Mr Guilin Qu (Executive Director of Asia-Pacific Network for Sustainable Forest Management and Rehabilitation), Mr Xingliang Chen (Deputy President of Chinese Academy of Forestry), Mr Weiming Song (President of Beijing Forestry University) and Mr Sun Joseph Chang (Chair of Organizing Committee and Professor in the School of Renewable Natural Resources, Louisiana State University Agricultural Center).
The Symposium was divided on fifteen, in total, concurrent sessions, which focused on issues such as:
- Economic growth and carbon emissions in China
- Efficiency analysis
- Trade
- Forest carbon sequestration
- Land allocation
- Natural conservation
- Behavioral economics
- Forest industry
- Evaluation of forestry investments
- Risk
- Forest protection
Last two days of the Symposium, participants spent on the field trip to the Saihanba Mechanized Forest Farm (Hebei Province), which will be described in coming post.
Next Symposium
During the first Faustmann Symposium, organizing committee decided that every 10 years, the symposium will take place in Germany. Therefore, without any exception, the next 6th International Faustmann Symposium will be organized again in Darmstad, in 2019.
All forest economists should already book this date in their calendars.
* Martin Faustmann, born in Giessen on 19 February 1822, studied forestry at the University of Giessen. In 1846 and 1848, he took the Universal States Examinations with excellent grades. From around 1846 on, he was co-editor of the “Allgemeine Forst- und Jagd-Zeitung” AFJZ (General Journal of Forestry and Hunting), which was a reputable science journal already at that time. In the AFJZ of 1849 Faustmann’s seminal article “Berechnung des Werthes, welchen Waldboden, sowie noch nicht haubare Holzbestände für die Waldwirthschaft besitzen” — “Calculation of the Value which Forest Land and Immature Stands Possess for Forestry” appeared. This paper stands as a high watermark for not only forest management and economics but also capital theory in economics.
In 1857, Faustmann became a head forester for Hessia-Darmstadt in the Babenhausen Forest District near Darmstadt, where he also died in 1876, at the age of 54.
Besides considering forest economic questions, Martin Faustmann developed also a tool for measuring the height of trees, the so-called Mirror Hypsometer, which was presented in the AFJZ in 1856.