Using DEA to compare the efficiency of planned forest management actions to actual forest management actions

A guiding principle in the development of forest management plans is that the plan should meet the principles of optimality, and thus efficiency. The resultant plan represents a snapshot in time of the decision makers (DMs) preferences, which can change through time as the DMs life situations changes. Even though the DM undertook the effort of formulating a plan for the forest, the actual decisions taken in the forest may not represent the planned activities. The divergence between these two decisions can be evaluated as the difference between the stated and observed preferences. This measure evaluates how closely the plan was followed, however it does not evaluate how close the actual decisions were to an optimal use of resources. As a method to compute the efficiency of the DMs actual choices, Data Envelopment Analysis (DEA) is used to evaluate the efficiency of both the planned and actual forest management decisions compared to the production potential frontier. In traditional DEA applications, the evaluation for efficiency is done through a relative comparison of a set of actual decision management units (DMUs). As a method to evaluate the efficiency of the forest management actions, a series of optimized plans, developed from the initial inventory data, serve as the DMUs to provide a relative comparison. The usefulness of this process is highlighted in an analysis of several privately held forest management plans from private owners in Finland. For these cases, the efficiency of the planned and actual management activities are evaluated with a fixed set of input and output criteria. This allows for an evaluation the effectiveness of the planning process, and evaluates the efficiency of the actual forest management actions taken in the forest.