Synergies in the Land Use Sector: What Is the Best Policy Approach When Co-benefits and Trade-offs Are Involved?

Martin Lopez

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Synergies in the Land Use Sector: What Is the Best Policy Approach When Co-benefits and Trade-offs Are Involved?

Martin Lopez

| Mar 06, 2020

Central European Economic Journal

Volume 6 (2019): Issue 53 (January 2019)

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Page range: 53 - 69

DOI: https://doi.org/10.2478/ceej-2019-0001

Keywords
Adaptation, Mitigation, Ecosystem Services, Deforestation, Forest Degradation

© 2019 Martin Lopez, published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

Conceptual map for tropical deforestation and forest degradation.Source: author's own elaboration.

Effect of land use change on the overall provision of regulating ES given different parameters specification.Source: author’s own elaboration. Notice that equation 5 is defined in terms of C and H, however, H is a function of C. Thus, the resulting curve can be plotted using only in terms of C. Parameter specification is as follows:
Black curve: s = 0.7, α = 0.5Blue curve: s = 0.4, α = 0.7Red curve: s = 0.5, α = 0.7Gray curve: s = 0.25, α = 0.75 — Effect of land use change on the overall provision of regulating ES given different parameters specification.Source: author’s own elaboration. Notice that equation 5 is defined in terms of C and H, however, H is a function of C. Thus, the resulting curve can be plotted using only in terms of C. Parameter specification is as follows: Black curve: s = 0.7, α = 0.5Blue curve: s = 0.4, α = 0.7Red curve: s = 0.5, α = 0.7Gray curve: s = 0.25, α = 0.75

Classification frequency of different policy scenarios.Source: author's own elaboration.

Environmental (C) and welfare indicators (GDP) of synergic outcomes by policySource: author's own elaboration.

Environmental and welfare indicators of alternative policy scenarios.Source: author's own elaboration.

Parameters of the model.

Fixed parameters

Parameter	Value	Description	Source
α	0.3	Exponent agriculture land in production function	Jointly determined to replicate late transition phase as reported in Hosonuma et al. 2012

β	0.7	Exponent agriculture land in production function

p_a	1.3	Output price agriculture

p_f	1	Output price forestry

γ	0.25	Exponent of state the state of the environment in externality function	Value selected to replicate forest cover along the different phases of forest transition as reported in Hosonuma et al. 2012

C_max	1	Maximum carbon stock (Normalized)	The values could not be derived from the literature directly. Nevertheless they are consistent with what can be found there

$\bar{L}$ \bar L	1	Land endowment (Normalized)

$\bar{T}$ \bar T	1	Labor endowment (Normalized)

k	0.25	Inflection point of Hill function	Assumption consistent with mathematical formulation

n	1	Steepness Hill functions	Assumption consistent with mathematical formulation

Random Parameters

s	N(0.5, 0.083)	Carbon share	Assumption consistent with mathematical formulation^*

α	U(0.1 – 0.85)	Elasticity of substitution	Assumption consistent with mathematical formulation
d	U(0.1 – 0.5)	Degradation	Specht et al 2015 and Gerwing 2002

Average forest cover in 2010 per phase of forest transition process.

Phase	Number of countries	Average forest cover (%)
Pre transition	13	69.9

Early transition	39	46.6

Late transition	33	21.3
Post transition	15	27.3

Policy configurations.

Policy/configuration	L_n quota^* (%)	Compensation⁺	Agr	For
Unregulated	0	No	-	-

Reserve	7	No	-	-

Compensation	7	Yes	-	-

Mitigation	7	No	Tax on C	-

Adaptation	7	No	-	Subcidy on H
Policy integration	7	No	Tax on C	Subcidy on H

Variables calculated for the numerical solution of the model and their use.

Economic subsectors

Variable	Description	Use
Π_j	Profit	Not reported but known to be zero

Y_j	Production	Calculate GDP

L_j	Land use	Model calibration

T_j	Labor use	Not reported

λ_j	Shadow price	Not reported

Factors Markets

w	Wage rate	Not reported

r	Opportunity cost of land	Calculate GDP (depending on policy configuration)

Ecologic sector

C	Carbon stock	Mitigation indicator

H	Hydrological services	Indirectly contained in GDP calculation
E	State of the environment	Calculate GDP

eISSN:: 2543-6821
Language:: English

Publication timeframe:: Volume Open
Journal Subjects:: Business and Economics, Political Economics, Economic Theory, Systems and Structures, Microeconomics, Macroecomics, Economic Policy

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Synergies in the Land Use Sector: What Is the Best Policy Approach When Co-benefits and Trade-offs Are Involved?

Published Online: Mar 06, 2020

Page range: 53 - 69

DOI: https://doi.org/10.2478/ceej-2019-0001

Keywords
Adaptation, Mitigation, Ecosystem Services, Deforestation, Forest Degradation

© 2019 Martin Lopez, published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

Fig. 1

Fig. 2

Fig. 3

Fig. 4

Fig. 5

Parameters of the model.

Average forest cover in 2010 per phase of forest transition process.

Policy configurations.

Variables calculated for the numerical solution of the model and their use.

Synergies in the Land Use Sector: What Is the Best Policy Approach When Co-benefits and Trade-offs Are Involved?

Published Online: Mar 06, 2020

Page range: 53 - 69

DOI: https://doi.org/10.2478/ceej-2019-0001

KeywordsAdaptation, Mitigation, Ecosystem Services, Deforestation, Forest Degradation

© 2019 Martin Lopez, published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

Fig. 1

Fig. 2

Fig. 3

Fig. 4

Fig. 5

Parameters of the model.

Average forest cover in 2010 per phase of forest transition process.

Policy configurations.

Variables calculated for the numerical solution of the model and their use.

Keywords
Adaptation, Mitigation, Ecosystem Services, Deforestation, Forest Degradation