The Economics of Desertification, Land Degradation, and Drought

Figure 3.4—Cost of action and cost of delayed action
Source: Author’s creation.
Figure 3.4 is only an example, and the curves it portrays can be expected to vary greatly in
their shape according to each specific situation. Nonetheless, it is this sort of curve that, once
developed, will help guide policy action against DLDD. Even when the curves are approximated, as
in Figure 3.3, they can help identify the crucial features of the problem at hand—that is, how much
effort should be devoted to fight DLDD, where, and at which cost (in Figure 3.4, approximated by the
difference between P0 and P1).
This framework, which can be implemented at reasonable data costs, should be undertaken in
several representative areas, thus bringing the site specificities of DLDD into its global economic
assessment. So far, valuation studies of the costs and benefits of land degradation and land
improvement (as will be presented in the next section) have focused on agroecosystems and their
provisioning services. This framework needs to be further developed, in combination with knowledge
built into projects such as TEEB, to cover more terrestrial ecosystem services (not only those related
to an agricultural output) and their benefits. The approach should be as comprehensive as current
science and knowledge allow and should include all the services affected directly or indirectly by
DLDD, which can be achieved similarly to the analysis of agroecosystem services by relying on
representative case studies. The case studies must be representative of different ecologies, livelihoods,
and institutional settings. Thus, in order to have statistically valid results, the case studies need to be
drawn from a global sampling frame. As a second component of the global coverage of land
degradation and drought issues, a global assessment must go beyond case studies to incorporate the
transboundary dimensions of land degradation and drought. These studies can be performed at
different scales, from localized (for example, erosion in Country A causes sedimentation of dams in
Country B) to global (for example, land degradation in a specific area has impacts on global climate
or on global food prices). Such transboundary effects of DLDD must be observed, recorded, and then
accounted for through integrated (that is, geographically and sector-wise connected) and dynamic
(accounting for the time dimension) modeling approaches.
A Brief Review of Cost–Benefit Analysis Applications to Land Degradation Issues
CBA is a tool suitable for comparing land-degrading and land-conserving management practices over
time. It requires knowledge of all costs and benefits associated with practices leading to degradation,
as well as of those leading to conservation. The distribution of costs and benefits over time is
accounted for by using appropriate discount rates to determine streams of discounted costs and
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