The Economics of Desertification, Land Degradation, and Drought

More documents

Recommendations

Info

understand these arrangements in order to devise sustainable and efficient policies to fight DLDD. For example, if farmers over irrigate, leading to salinization of the land, it must be understood why they do so. As an illustration, it may be that institutional arrangements, also referred to as distorting incentive structures, make it economically profitable for farmers to produce as much crops as possible. Missing or very low prices of irrigation water in irrigation schemes act as such an incentive in a misleading institutional setup. The rules of the game play a role in determining the causes, outcomes, and actions to prevent or mitigate DLDD, but they are too complex to be portrayed accurately in Figure 1.1. Hence, they are captured as a dashed circle enclosing and affecting everything within it. How exactly institutions affect land use decisions is the subject of Section 4. Market Failures for Most Ecosystem Services Markets for most of the regulating and supporting services do not exist. The lack of market prices for ecosystem services means that the benefits derived from these goods (often public in nature) are usually neglected or undervalued in decision making. Many ecosystem services are public goods, which means they are usually open in access. Public goods are nonrival in their consumption—that is, consumption of the good by one person does not diminish the amount consumed by another person. The public-good nature of many ecosystem services prevents correct pricing of the resource and creates the need for economic valuation and policymaking (Freeman 2003). Land use decisions rarely consider public benefits and mostly focus only on localized private costs and benefits. Benefits that occur after a long-term horizon, such as that from climate regulation, are frequently ignored. This neglect leads to a systematic undervaluation of ecosystem services, because values that are not part of financial or economic considerations are somehow ignored. The failure to capture the values causes non optimal rates of land degradation. To adequately account for ecosystem services in decision making, the economic values of those services have to be determined. In Section 4, a number of economic valuation techniques that can be used are discussed. However, attributing economic values to ecosystem services is challenging, due to many unknowns and actual measurement constraints. As economic values linked to the number of (human) beneficiaries and the socioeconomic context, these services depend on local or regional conditions. This dependence contributes to the variability of the values (TEEB 2010). The precondition for an economic valuation of the ecosystem services provided by land is knowledge regarding the state of land resources and their ecosystem services. Although recent global approaches to the assessment of land degradation have greatly contributed to the knowledge of worldwide land degradation and its relevance for human development, they are still subject to criticism regarding the accuracy of the results on the regional and local level. The gaps related to the measurement of DLDD and, more specifically, to the provision of ecosystem services challenge their economic valuation. As TEEB (2009) indicates, a global framework that identifies a set of key attributes and then monitors these by building on national indicators could help answering this challenge. Valuation of Marginal Changes in DLDD Typically, land degradation is a slow-onset problem. Therefore, the valuation of the different costs must be conducted at the margin (Stern 2006; Balmford et al. 2008). It is the costs induced by marginal (relatively small) changes in the level of DLDD that must be evaluated through both their impacts on the provision of terrestrial ecosystem services and their benefits. There is a need for marginal analysis because land degradation does not represent binomial events—that is, it does not account for the presence or absence of land degradation, but rather for events taking place slowly in different orders of severity (for example, low or severe degradation). Desertification is not a binomial event either; rather it slowly covers a wide range of land degradation levels in dryland areas. Even droughts—though actually defined as binomial events—can have huge differences in their severity, thus leading to varying levels of land degradation. Consequently, it would not be of much relevance for policymakers to know the costs of fully degraded land resources or of conserving all of them or of having a drought or of not having one. Action against DLDD is intended to decrease its severity, as well as to discern the means (financial and otherwise) of implementing land conservation measures or, for droughts, of ameliorating their impacts. Hence, the costs of actions can be measured against these 6
small changes: How much does it cost to generate a small improvement of DLDD-affected lands? 3 Further, the definition of marginal changes in DLDD is usually determined by changes that can be brought about by specific land conservation policies (for example, planted hedgerows to prevent erosion) or sometimes by specific levels of mitigation policies (for example, fertilizers to compensate for low soil nutrients). “[The] valuation of [the] marginal changes is anchored into specific ‘states of the world’ generated from counterfactual scenarios where a specific policy action is either adopted or not” (Balmford et al. 2008, 7-8). The states of the world in a specific area are determined by economic geography, land use, population distribution, and land conservation and DLDD mitigation strategies, as well as external factors, such as climate. Actions against DLDD, based on empirical evidence, are used to generate different states of the world using projection scenarios and simulations. Site-Specific Valuation Naturally, the impacts of specific actions on specific types of DLDD, such as terracing against erosion, are highly site and case specific. Hence, the description of the state of the world is usually a description of the state of the site. Due to the time restrictions under which this report was compiled, it was not possible to be exhaustive in the list and types of sites that were covered. Rather, acknowledging the need to be site specific in the valuation of the costs of DLDD (action versus inaction), we review and propose methodologies to be subsequently applied to a wide range of case studies. The case studies presented in this report serve the purpose of illustrating these methodologies. Time Dependence and Discounting Degradation of an ecosystem may not translate directly or immediately into a loss of services. Ecosystems can take up to a certain level of degradation and then start to decline rapidly (TEEB 2009). The impacts of specific DLDD processes and of the actions used to mitigate them are felt through time, in a way that is most often nonlinear. For instance, whereas terracing might have a direct and stable affect on erosion levels (when all other components of the state of the site are kept constant), the impact of afforestation on nitrogen cycling is clearly time dependent. Similarly, the impacts of specific land degradation processes on the provision of ecosystem services vary across time. For instance, erosion has a nonlinear impact on crop yields, as the erosion of top soil depletes nutrients mostly early in the process, thus rapidly affecting crop yields; further erosion, however, shows limited impact on soil. Hence, an analysis of erosion might show no impact on agricultural yields, even though or because the crucial resource (top soil) has already been depleted. With such dynamic processes and links, we must ideally value ecosystem services in a nonstatic way, aggregating the economic value of terrestrial ecosystem benefits through time. The impacts of marginal changes in DLDD are then expressed in terms of their impact on the discounted value of a stream of terrestrial ecosystem benefits. The benefits are discounted in order to compare the value of the aggregation of present and future benefit streams, expressed in terms of their value at a common point in time—the present. The cost of inaction is equal to the difference between the sums of the discounted ecosystem benefits and their direct and indirect effects under the action and inaction scenarios (the former should be higher than the latter, unless DLDD is broadly beneficial to human well-being and DLDD-preventing investment is not competitive with alternative investments in human well-being in the long run). The cost of action is equal to the discounted costs of the different DLDD prevention, mitigation, or restoration costs, including their off-site, indirect, and future costs. The cost of preventing land degradation will be much smaller than the cost of rehabilitating already severely degraded lands (see Figure 1.3). Hence, costs of action will increase the more actions against DLDD are delayed. 3 This approach can pose problems when there are abrupt (“nonlinear” in economic jargon) changes in the relationship between the level of DLDD and the provision of terrestrial ecosystem services. Therefore, particular attention must be paid to the study of drivers of these relationships. 7
Page 1 and 2: IFPRI Discussion Paper 01086 May 20
Page 3 and 4: Contents Abstract vii Acknowledgmen
Page 5 and 6: List of Figures 1.1—Conceptual fr
Page 7 and 8: ABSTRACT Attention to land degradat
Page 9 and 10: ABBREVIATIONS AND ACRONYMS ADB Asia
Page 11: SCAR Soil Conservation in Agricultu
Page 14 and 15: In the present report, the conceptu
Page 16 and 17: Framework: Confronting Action versu
Page 20 and 21: Figure 1.3—Prevention, mitigation
Page 22 and 23: on assessments at the micro level (
Page 24 and 25: does not clearly distinguish betwee
Page 26 and 27: Figure 2.1—GLASOD (1991) global a
Page 28 and 29: International Earth Science Informa
Page 30 and 31: Box 2.1—Continued Normalized Diff
Page 32 and 33: Figure 2.4—Loss of annual NPP, GL
Page 34 and 35: Figure 2.7—Annual loss of NPP in
Page 36 and 37: Table 2.2—Nitrogen application ra
Page 38 and 39: Figure 2.12—Areas affected by hum
Page 40 and 41: output—which is a selection of su
Page 42 and 43: GLADIS also underlines the linkage
Page 44 and 45: Box 2.2—Continued A map on global
Page 46 and 47: Table 2.3—Global land degradation
Page 48 and 49: Table 2.3—Continued Project and d
Page 50 and 51: Table 2.4—Continued Location 10 2
Page 52 and 53: Table 2.6—Extent and severity of
Page 54 and 55: National Level Policies As discusse
Page 56 and 57: Such support has also been directed
Page 58 and 59: Migration, either as outmigration o
Page 60 and 61: The preceding discussion shows the
Page 62 and 63: Results Correlation Analysis Consis
Page 64 and 65: Figure 2.23—Relationship between
Page 66 and 67: Effects of Land Degradation On-Site
Page 68 and 69:
soils and higher land productivity.
Page 70 and 71:
Acknowledging the work of GLADIS, a
Page 72 and 73:
health, education, security, enviro
Page 74 and 75:
Box 3.1—Recent major economic ass
Page 76 and 77:
An appropriate economic tool for a
Page 78 and 79:
Figure 3.4—Cost of action and cos
Page 80 and 81:
enefit—for example, income. This
Page 82 and 83:
Figure 3.6—Ecosystem services fra
Page 84 and 85:
Replacement Cost Approaches The rep
Page 86 and 87:
Box 3.2—Measuring land degradatio
Page 88 and 89:
land degradation and conservation m
Page 90 and 91:
Flooding and Aquifer Recharge Richa
Page 92 and 93:
year (Diao and Sarpong 2007). Sonne
Page 94 and 95:
Bringing together the different cos
Page 96 and 97:
This section discusses the most imp
Page 98 and 99:
governing land use patterns (Leeman
Page 100 and 101:
promotion of community forest manag
Page 102 and 103:
Box 4.3—Reducing emissions from d
Page 104 and 105:
Soil Nutrient Depletion Soil nutrie
Page 106 and 107:
that the yields of salt-tolerant wh
Page 108 and 109:
Figure 5.3—Forest area as a perce
Page 110 and 111:
Figure 5.5—Per capita water stora
Page 112 and 113:
Introduction 6. CASE STUDIES Five c
Page 114 and 115:
Salinity The effects of salinity on
Page 116 and 117:
Third, to correctly decide which ac
Page 118 and 119:
Costs of Action and Inaction We eva
Page 120 and 121:
The NGOs and religious organization
Page 122 and 123:
have a strong influence on NRM (And
Page 124 and 125:
We estimated the cost of action (de
Page 126 and 127:
Figure 6.15—Costs of action and i
Page 128 and 129:
Of interest to us is the strategy t
Page 130 and 131:
7. PARTNERSHIP CONCEPT The review o
Page 132 and 133:
degradation. All this should be don
Page 134 and 135:
Finally, the global assessment of D
Page 136 and 137:
the experience of and lessons learn
Page 138 and 139:
Table 7.3—Example of E-DLDD resea
Page 140 and 141:
8. CONCLUSIONS Since the publicatio
Page 142 and 143:
lowest in the region. From a socioe
Page 144 and 145:
Table A.1—Land degradation assess
Page 146 and 147:
Table A.2—Continued Author Region
Page 148 and 149:
Table A.3—Continued Author Countr
Page 150 and 151:
Page 152 and 153:
Page 154 and 155:
Page 156 and 157:
Table A.5—Costs of land degradati
Page 158 and 159:
Figure B.1—Land use systems of th
Page 160 and 161:
REFERENCES Abelson, P. 1979. Cost B
Page 162 and 163:
Benin S., E. Nkonya, G. Okecho, J.
Page 164 and 165:
Clark, E. H. 1985. The Off-Site Cos
Page 166 and 167:
De Jager a., D. Onduru and C. Walag
Page 168 and 169:
Foster, V., and C. Briceño-Garmend
Page 170 and 171:
Holden, S. and H. Lofgren. 2005. As
Page 172 and 173:
Lapar, M. L., and S. Pandey. 1999.
Page 174 and 175:
Nachtergaele, F., M. Petri, R. Bian
Page 176 and 177:
Pender, J. L. 2009. “Food Crisis
Page 178 and 179:
Sauer, J., and H. Tchale. 2006. Alt
Page 180 and 181:
Tan, Z. X., R. Lal, and K. D. Wiebe
Page 182 and 183:
———. 2010. “Assessment of L
Page 187 and 188:
RECENT IFPRI DISCUSSION PAPERS For
show all

The Economics of Desertification, Land Degradation, and Drought

Create successful ePaper yourself

Delete template?

Save as template?