Economic feasibility and management considerations in range revegetation

Abstract

Although range researchers and managers involved in range revegetation often have little economics training, economic analysis is usually a crucial step in range revegetation decisions. This synthesis paper is intended to provide a useful background in economic analysis for teachers, students, and natural resource professionals who deal with range revegetation. First, 3 economic standards by which all revegetation projects must be judged are described and interpreted: (1) economic feasibility, (2) economic efficiency, and/or (3) cost effectiveness. Next, the information required for economic analysis and the analytical procedures used to evaluate range revegetation projects are described. A detailed reseeding example is then used to describe the following information requirements: project costs, benefits, value of benefits, interest rate (including real vs. nominal rates), risk, project life (including life extension and grazing deferment), and range site selected for revegetation. Last, procedures for determining optimal vegetation conversion and use are reviewed, emphasizing the vegetation response function as the key to balancing the 3 determinants of long-term net returns: initial vegetation conversion, grazing intensity, and project life.