3 ms·

That's a very limited (XIXth century?) perspective. A forest (like, anything) has economic value, as soon as you get people to adopt/believe in it. A forest m

That's a very limited (XIXth century?) perspective. A forest (like, anything) has economic value, as soon as you get people to adopt/believe in it. A forest may even have a greater economic value than the lumber it could produce, if it would, for instance, help/ensure the prosperity of something else that has economic value (leisure, wildlife, heat protection, soil water retention, etc.).

_heimdall 2y ago
I completely agree outside of economics. I put much higher value on a forest than lumber. Economically, though, where is the forest ever accounted for?
- Juliate 2y ago
  In your strategic business plan, by IFRS accounting standards (existing and developing). You have several options, account for it as lumber (but... well), or as a carbon sequestration well (so you could get carbon credits, IAS 38), or as an ecosystem providing services (several frameworks under work here), or as a contingent liability or asset (IAS 37, can be in the balance sheet if the probability of event/impact is high/certain). Even if you forget to account for it, your insurance likely will remind you about it.
  - _heimdall 2y ago
    Once someone can "own" the forest, that be a bit of a cheat around the whole idea. I'm thinking out loud here, but I think all of you're examples are actually valuing the financial mechanisms rather than the forest itself. The carbon credits are given economic value, its just not a physical resource like lumber so its harder to distinguish that the credit holds the value rather than the forest.
    - Juliate 2y ago
      You ask me how to account for it. In accounting, that’s how, and you can get creative too.
      - _heimdall 2y ago
        Sure, but in those accounting mechanisms are you valuing the forest or the financial asset the paper ownership of forestland grants you? I'd expect the lumber or carbon credits, for example, to be the actual asset accounted for rather than the forest itself.

_heimdall 2y ago

I completely agree outside of economics. I put much higher value on a forest than lumber. Economically, though, where is the forest ever accounted for?

Juliate 2y ago
In your strategic business plan, by IFRS accounting standards (existing and developing). You have several options, account for it as lumber (but... well), or as a carbon sequestration well (so you could get carbon credits, IAS 38), or as an ecosystem providing services (several frameworks under work here), or as a contingent liability or asset (IAS 37, can be in the balance sheet if the probability of event/impact is high/certain). Even if you forget to account for it, your insurance likely will remind you about it.
- _heimdall 2y ago
  Once someone can "own" the forest, that be a bit of a cheat around the whole idea. I'm thinking out loud here, but I think all of you're examples are actually valuing the financial mechanisms rather than the forest itself. The carbon credits are given economic value, its just not a physical resource like lumber so its harder to distinguish that the credit holds the value rather than the forest.
  - Juliate 2y ago
    You ask me how to account for it. In accounting, that’s how, and you can get creative too.
    - _heimdall 2y ago
      Sure, but in those accounting mechanisms are you valuing the forest or the financial asset the paper ownership of forestland grants you? I'd expect the lumber or carbon credits, for example, to be the actual asset accounted for rather than the forest itself.