| Sumario: | An examination of the economic parameters for resource policy analysis in developing countries using Bangladesh as a case study, which focuses principally on the treatment and valuation of labor, capital, and other inputs in forest management. The market prices of some inputs may be distorted by different influences, such as taxes and subsidies, minimum wage levels, tariffs and import quotas, and price controls. Opportunity costs (shadow prices), which measure the value of a commodity or a service from the viewpoint of the economy as a whole, are used where appropriate to address this problem. The level of interest rates plays a significant role in the analysis due to the necessity of compounding costs to a target year. Increasing interest rates had substantial effects on prices, but only a minor effect on levels of output, land allocations, and employment because of the inelasticity of the demand schedule.
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