486 APPENDIX 



besides its efficiency as a manager, also to take into consideration problems of political 

 economy, not only in regard to production, but also economic relations. It is desirable 

 that it should exert a favorable influence in that direction upon all the forests of the 

 country. But it stands to reason, and is in accord with the status of legislation in all 

 countries, that this shall be most emphatically done in its own forests. 



Even in time to come there will still be differences of the kind mentioned — not merely 

 in forest management but also in economic life in general. Even in future times the 

 State forests will, as a rule, be more conservatively managed than most private forests. 

 It is not an inevitable result of this, however, that under State or communal management 

 a portion of the cost of production cannot be taken into account — which is the present 

 point of difference in economic principles. Forest owners (State, commimity, etc.), 

 even if they favor communal interests, need not, as the champions of all socialistic 

 tendencies demanded, renounce the interest on a portion of the capital invested (Pro- 

 duktionsgrundlagen). On the contrary, the most general rule apphcable to all kinds of 

 forest ownership demands that in regulating management all costs of production in 

 labor, capital, and land must be reckoned at their fuU value. But there could well be 

 differences in the cost of production depending on the character of the forest ownership, 

 resulting from variations in the size of the growing stock and the rate of interest charged. 

 An analogous condition exists in agriculture. Indeed, the inter-relationships of labor, 

 capital, and land vary according to the character of the ownership even if the objects of 

 management be identical. The greater conservatism which characterizes State forest 

 management cannot, however, be regarded as an indication of self-sacrifice on the part 

 of the treasury department or of a readiness to give up claim to a part of the investment. 

 The State does not need to give up all claims to the interest on the capital and on the 

 value of the land in the interests of either present or future generations. The advocates 

 of management for financial returns may expect, rather, that the woods which the com- 

 ing political economy needs most urgently will best be paid for on the basis of their cost 

 of production with which must be included the discounted value of the cost of cultiva- 

 tion, and the interest on the investment. In that case it is demanded of State manage- 

 ment, however, that the rotation period shall not be longer than is required, in accordance 

 with silvicultural principles, for the production of that particular kind of product which 

 constitutes the object of the management. The French forest management which, 

 because of its moderate thinnings and long rotation period, is characterized by very 

 small interest on the investment, is susceptible of radical improvement along just these 

 lines. 



As opposed to the demand for an acceleration of production and a shortening of the 

 rotation period which must be demanded of the French management of State forests, 

 intelligent private owners have of late seen fit to change their hitherto extensive manage- 

 ment to a more intensive sjrstem, and to lengthen their rotation periods. This is the 

 direct result of the market conditions for the various grades of product. 



The prices of the smaller products (twigs, bark) have declined because of the competi- 

 tion by charcoal and other substitutes, while those of the higher grade lumber have risen 

 not only actually, but relatively, in comparison with other commodities. Furthermore, 

 as was evident from the great number of the cross sections exhibited at the Paris Exposi- 

 tion, it has become a matter of common knowledge in Prance that properly conducted 

 thinnings and openings exercise a very favorable influence upon the progress of diameter 

 increment, upon which the rotation period is dependent. Mention is made, also, in the 

 Handbook of the Paris Exposition of the changes wrought by this in the viewpoint of 

 private owners, in the following words: "A change is imminent in the conditions which 

 have hitherto existed (profitableness of the coppice system, and of short rotations). The 

 rise in wages and the absence of a market for charcoal have reduced the value of coppice 



