An economic assessment of risk and returns from prescribed burning on tallgrass prairie.

A stochastic (Monte Carlo) simulation model was developed to evailurte the influence of prescribed burning on the expected value and variability of net returns from a representative stocker cattle enterprise. The model was applied to both shallow prairie and eroded prairie range sites ln eastern Oklahoma. Prescribsd burning is shown to be an economically fusible means of improving the productivity of eastern red&u infested rangeland. Impiementatlon of an annual burning program resulted in a S69.00 and S4.80 per hect8re incre8se in the net present value of the lO-yeu return stream generated from stocker cattle production on shallow prairie and eroded prairie range sites, respectlveiy. Prescribed burning does not increase the variability of annual income from stocker cattle production. However, when risk is measured in terms of relative variability (coefficient of variation) or the probability of annual returus below zero, prescribed burning is determined to be a risk-reducing practice.

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