The Economics of Desertification, Land Degradation, and Drought

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land degradation and conservation measures and, hence, also increases the likelihood of farmers to adopt conservation (Bekele and Drake 2003). 51 An interesting feature of the study by Amsalu and de Graaf (2007) is that they analyzed adoption as well as the continued use of soil conservation measures; they found that factors influencing adoption and continued use of the stone terraces in the Ethiopian highlands are not the same. Actually, long-term adoption is more relevant to analyze, as it allows maintaining soil productivity in the long run. Further work on long-term adoption and use is required. Estimation of the Farm-Level Costs and Benefits of Land Degradation The formal analysis of land degradation began in the 1980s with optimal control models (developed by Burt [1981] and McConnell [1983]) that modeled the decision of individual farmers. These models aimed at maximizing the net present value of the agricultural output in order to find the optimal rate of land degradation. Optimization models have various advantages over partial budgeting (as described earlier), because they are not limited to a fixed number of alternative options; rather, they allow for more flexibility in adaptation. Furthermore, they help select the optimal profit that maximizes land management practice. An important advantage of optimization models 52 is that they deliver shadow values, representing changes in profits, which are derived from marginal changes in resources (Mullen 2001). De Graaf (1996) referred to these models as investment models, because they focus on profit maximization as the sole objective of a farmer. This may be the case for large commercial farmers, but peasants and farm households may behave differently (Kruseman et al. 1997). Households may decide on farming activities and soil conservation measures in a way that maximizes utility (which includes risk considerations and accounts for a subsistence level of income) rather than profits. These kinds of models appear to be more appropriate when farm households and farmers producing mainly for subsistence or at a smaller scale need to be considered. In summary, the models described here are flexible and allow the integration of economic and biophysical conditions and feedbacks into the local economy; thus, they explicitly model the relationship between production and degradation. These models can be designed for multiple periods (see, for example, Shiferaw and Holden 2005) or for a single year (see, for example, Day, Hughes, and Butcher 1992). Furthermore, they incorporate the impacts of various market imperfections (see, for example, Shiferaw and Holden 2001; Holden, Shiferaw, and Pender 2004) and can incorporate the impacts of policies and subsidies (for example, access to credits in Börner 2006), as well as combined impacts of land degradation, population growth, and market imperfections (Holden and Shiferaw 2004). These advantages come at a cost: The models are data demanding and highly complex. Therefore, many studies have evolved that use the cost–benefit analysis framework as presented earlier. Many farm household models have been developed to address land conservation decisions in Ethiopia. Mengistu (2011) developed a farm household model to analyze selected policy incentives and technology interventions on land quality and income of small farm households in the Anjeni area of northwestern Ethiopia. Another farm household model for Ethiopia’s Ada district was developed by Shiferaw and Holden (2000, 1999, 1998). Major model activities include crop production on uplands and lowlands with three levels of fertilizer use, with and without conservation measures; crop sale and consumption; seasonal family labor; labor hiring; leisure; and livestock production and activities to account for future negative impacts of soil erosion. A more recent application developed by Holden, Shiferaw, and Pender (2004) 53 incorporated access to nonfarm income and analyzed its impact on soil-conserving behavior. 51 Other factors that may have an impact on adoption that were analyzed in studies are the influence of family labor, livestock, soil fertility, soil depth, erosion status, agricultural inputs, management practices, and diversification, as well as other physical, personal, economic, or institutional factors. 52 These initial models were further developed by various authors, such as Barbier (1990), Barrett (1991), Miranda (1992), Clarke (1992), and Coxhead (1996). 53 Based on earlier versions developed by Shiferaw et al. (2001, 2002) and Shiferaw (2004), and Holden, Shiferaw, and Pender (2002). 76
Estimation of Off-Site Costs and Benefits Off-site costs are related to the effects of land degradation on the surrounding environment, in particular downstream impacts of land degradation. However, they also comprise global effects on services, such as carbon sequestration, biodiversity, and food security. We have already described in detail the possible off-site effects arising from land degradation. Many studies were conducted to come up with cost estimates for the impact of sedimentation caused by upstream soil erosion on agricultural land. Lost soil drains into major dams and reservoir systems that provide irrigation, hydroelectricity, or flood control services. Siltation in reservoirs reduces water storage and electricity production, shortens the life span of dams, and increases their maintenance costs. Heavy sedimentation frequently leads to river and lake flooding. As a first step, it is important to quantify the amount of sedimentation caused by land degradation, particularly by agricultural soil loss. Unfortunately, other activities, such as mining, construction works, or unpaved roads, also contribute to sedimentation, which means the relative impact of its causes is difficult to determine. The dynamics of sedimentation processes are complex: Sediments may be temporary or permanently stored along the waterways, and it takes time for impacts from increased sedimentation in reservoirs to become visible. Furthermore, a strict categorization of sedimentation as a cost factor may not be adequate, because sedimentation may be beneficial to downstream users by providing farmers with fertile, nutrient-rich soil (Clark 1996) or by serving as construction input (Enters 1998). Existing studies have employed a range of methods for the valuation of off-site effects of land degradation—chiefly, erosion. The following review sorts studies according to the kind of damage or off-site cost that is valued. Appendix A provides a brief, systematic overview of relevant studies estimating off-site costs in a table format. Damage on Reservoirs for Irrigation and Hydropower Various estimations of the costs due to the sedimentation of reservoirs were conducted by Cruz, Francisco, and Tapawan-Conway (1988) in the Philippines and Magrath and Arens (1989) in Java, Indonesia. Wiggins and Palma (1980), as reviewed in Clark (1994), estimated the impact of reservoir sedimentation on hydropower generation. The loss in generation capacity is valued in terms of the least-costly alternative source of power, which is electricity generated by thermal power stations (Clark 1994). Abelson (1979), as reviewed in Clark (1994), analyzed the impact of sedimentation on irrigation water by estimating the decline in the output of dairy farms that use water for irrigation. The value of water lost due to lower storage capacity was then calculated from the social value of milk production based on world market prices (Clark 1994). Vieth, Gunatilake, and Cox (2001) estimated the off-site costs of soil erosion in the Upper Mahaweli watershed in Sri Lanka. The reduced capacity of the reservoir to store water for irrigation is valued by the reduction in irrigated area, the impact on hydropower production, and the increased water purification costs. Hansen and Hellerstein (2007) valued the impacts of soil conservation on reservoir services in terms of reduced dredging costs for a one-ton reduction in erosion across the 2,111 U.S. watersheds. Navigation Damage Sedimentation due to soil erosion may also have negative impacts on navigation in waterways. Gregerson et al. (1987) analyzed this impact for the Panama Canal. The cost of sedimentation is valued by the cheapest alternative method to deepen the canal using dredgers. Hansen et al. (2002) quantified the costs of soil erosion to downstream navigation using a damage-function approach. Water Treatment As mentioned in the study of Vieth, Gunatilake, and Cox (2001), sedimentation causes a higher level of turbidity, which increases the cost of water purification. Moore and McCarl (1987) used the cost of extra chemicals that are needed to coagulate the particles in the water to value this off-site impact. Holmes (1988) used a hedonic cost function to estimate the cost of water purification. Nkonya et al. (2008b) included the increased costs of production of clean water due to soil. 77
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IFPRI Discussion Paper 01086 May 20
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Contents Abstract vii Acknowledgmen
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List of Figures 1.1—Conceptual fr
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ABSTRACT Attention to land degradat
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ABBREVIATIONS AND ACRONYMS ADB Asia
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SCAR Soil Conservation in Agricultu
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In the present report, the conceptu
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Framework: Confronting Action versu
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understand these arrangements in or
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Figure 1.3—Prevention, mitigation
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on assessments at the micro level (
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does not clearly distinguish betwee
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Figure 2.1—GLASOD (1991) global a
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International Earth Science Informa
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Box 2.1—Continued Normalized Diff
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Figure 2.4—Loss of annual NPP, GL
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Figure 2.7—Annual loss of NPP in
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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 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
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Table 7.3—Example of E-DLDD resea
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8. CONCLUSIONS Since the publicatio
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lowest in the region. From a socioe
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Table A.1—Land degradation assess
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Table A.2—Continued Author Region
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Table A.3—Continued Author Countr
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Table A.5—Costs of land degradati
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Figure B.1—Land use systems of th
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REFERENCES Abelson, P. 1979. Cost B
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Benin S., E. Nkonya, G. Okecho, J.
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Clark, E. H. 1985. The Off-Site Cos
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De Jager a., D. Onduru and C. Walag
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Foster, V., and C. Briceño-Garmend
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Holden, S. and H. Lofgren. 2005. As
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Lapar, M. L., and S. Pandey. 1999.
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Nachtergaele, F., M. Petri, R. Bian
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Pender, J. L. 2009. “Food Crisis
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Sauer, J., and H. Tchale. 2006. Alt
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Tan, Z. X., R. Lal, and K. D. Wiebe
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———. 2010. “Assessment of L
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