Improving the way land use change is handled in economic models

Zhao, Xin; van der Mensbrugghe, Dominique Y.; Keeney, Roman M.; Tyner, Wallace E.

doi:10.1016/j.econmod.2019.03.003

Title: Improving the way land use change is handled in economic models

Full Record
Other Related Research

Abstract

Sound economic modelling of land use in global economic models is critical for evaluating agricultural, biofuel, and climate policies. Current approaches do not preserve physical land area, do not account for the fact that land is of different qualities, or do not explicitly include the cost of converting land from one use to another. This study proposes a land use modelling framework building on the additive form of the constant elasticity of transformation (ACET) approach. We demonstrated that the framework could (1) directly provide traceable physical land use results, (2) flexibly handle land productivity differences based on biophysical information, (3) explicitly introduce land conversion cost, and (4) provide welfare decomposition in light of land heterogeneity and conversion cost. An experiment of mandating a 10 percent increase in grain consumption in the US food sector showed that ignoring land heterogeneity and conversion cost would underestimate the welfare loss by 28 percent.

Authors:

^[1]; van der Mensbrugghe, Dominique Y. ^[2]; Keeney, Roman M. ^[2];

^[2]

Purdue Univ., West Lafayette, IN (United States); Pacific Northwest National Lab. (PNNL), College Park, MD (United States)
Purdue Univ., West Lafayette, IN (United States)

Publication Date:: Sat Mar 16 00:00:00 EDT 2019

Research Org.:: Pacific Northwest National Lab. (PNNL), Richland, WA (United States)

Sponsoring Org.:: USDOE

OSTI Identifier:: 1507540

Alternate Identifier(s):: OSTI ID: 1735957

Report Number(s):: PNNL-SA-142335
Journal ID: ISSN 0264-9993

Grant/Contract Number:: AC05-76RL01830

Resource Type:: Accepted Manuscript

Journal Name:: Economic Modelling

Additional Journal Information:: Journal Volume: 84; Journal ID: ISSN 0264-9993

Publisher:: Elsevier

Country of Publication:: United States

Language:: English

Subject:: 54 ENVIRONMENTAL SCIENCES; Land use modelling; CET; Additive CET; Land heterogeneity; Conversion cost; General equilibrium

Citation Formats


                    Zhao, Xin, van der Mensbrugghe, Dominique Y., Keeney, Roman M., and Tyner, Wallace E. Improving the way land use change is handled in economic models.  United States: N. p., 2019. 
Web.  doi:10.1016/j.econmod.2019.03.003.

Copy to clipboard


                    Zhao, Xin, van der Mensbrugghe, Dominique Y., Keeney, Roman M., & Tyner, Wallace E. Improving the way land use change is handled in economic models.  United States.  https://doi.org/10.1016/j.econmod.2019.03.003

Copy to clipboard


                    Zhao, Xin, van der Mensbrugghe, Dominique Y., Keeney, Roman M., and Tyner, Wallace E. Sat .  
"Improving the way land use change is handled in economic models".  United States.  https://doi.org/10.1016/j.econmod.2019.03.003.  https://www.osti.gov/servlets/purl/1507540.

Copy to clipboard


                    
@article{osti_1507540,

  title        = {Improving the way land use change is handled in economic models},

  author       = {Zhao, Xin and van der Mensbrugghe, Dominique Y. and Keeney, Roman M. and Tyner, Wallace E.},

  abstractNote = {Sound economic modelling of land use in global economic models is critical for evaluating agricultural, biofuel, and climate policies. Current approaches do not preserve physical land area, do not account for the fact that land is of different qualities, or do not explicitly include the cost of converting land from one use to another. This study proposes a land use modelling framework building on the additive form of the constant elasticity of transformation (ACET) approach. We demonstrated that the framework could (1) directly provide traceable physical land use results, (2) flexibly handle land productivity differences based on biophysical information, (3) explicitly introduce land conversion cost, and (4) provide welfare decomposition in light of land heterogeneity and conversion cost. An experiment of mandating a 10 percent increase in grain consumption in the US food sector showed that ignoring land heterogeneity and conversion cost would underestimate the welfare loss by 28 percent.},

  doi          = {10.1016/j.econmod.2019.03.003},

  journal      = {Economic Modelling},

  number       = ,

  volume       = 84,

  place        = {United States},

  year         = {Sat Mar 16 00:00:00 EDT 2019},

  month        = {Sat Mar 16 00:00:00 EDT 2019}

}

Copy to clipboard

Journal Article:

Free Publicly Available Full Text

Accepted Manuscript (DOE)

Publisher's Version of Record

https://doi.org/10.1016/j.econmod.2019.03.003

Other availability

Search WorldCat to find libraries that may hold this journal

Save / Share:

Export Metadata

Save to My Library

Similar Records in DOE PAGES and OSTI.GOV collections:

The critical role of conversion cost and comparative advantage in modeling agricultural land use change

Conference Zhao, Xin ; Calvin, Katherine V. ; Wise, Marshall A.

The theoretical difference in land use modeling approaches is an important uncertain factor in evaluating future climate scenarios in global economic and integrated assessment models. In this study, we compared several widely used land use modeling approaches including constrained optimization, constant elasticity of transformation (CET), the additive form of constant elasticity of transformation (ACET), logit, and Ricardian. We demonstrated that the approaches differ not only by the extent of parameter uses but also by the definition of conversion cost and the consideration of comparative advantage implied by land heterogeneity. We developed a generalized hybrid approach by incorporating ACET/logit and Ricardianmore »« less
The Critical Role Of Conversion Cost And Comparative Advantage In Modeling Agricultural Land Use Change

Journal Article Zhao, Xin ; Calvin, Katherine V. ; Wise, Marshall A. - Climate Change Economics

The difference in land use modeling approaches is an important uncertain factor in evaluating future climate scenarios in global economic models. We compare five widely used land use modeling approaches: constrained optimization, constant elasticity of transformation (CET), the additive form of constant elasticity of transformation (ACET), logit, and Ricardian. We demonstrate that the approaches differ not only by the extent of parameter uses but also by the definition of conversion cost and the consideration of comparative advantage implied by land heterogeneity. We develop a generalized hybrid approach that incorporates ACET/logit and Ricardian to account for both conversion cost and comparativemore »« less
https://doi.org/10.1142/S2010007820500049

Full Text Available
Modeling the Economic and Environmental Impacts of Land Scarcity Under Deep Uncertainty

Journal Article Dolan, Flannery ; Lamontagne, Jonathan ; Calvin, Katherine ; ... - Earth's Future

Land scarcity is increasing over time, driven by complex multi-sector dynamics. The future evolution of various sectors and even the dynamics of their interactions are deeply uncertain or poorly understood. The impacts of land scarcity on the economy and environment are multi-faceted and regional, so any action to convert land will contain inherent tradeoffs. Many different land-use pathways may mitigate the worst impacts of climate change, however, the impacts of these pathways are highly uncertain in the face of future changes. A need exists to provide multi-metric and multi-sector assessments that are robust to myriad uncertainties. Land conservation effectively limitsmore »« less
https://doi.org/10.1029/2021EF002466
Assessing Marginal Land Availability Based on Land Use Change Information in the Contiguous United States

Journal Article Jiang, Chongya ; Guan, Kaiyu ; Khanna, Madhu ; ... - Environmental Science and Technology

Utilization of marginal land for growing dedicated bioenergy crops for second-generation biofuels is appealing to avoid conflicts with food production. This study develops a novel framework to quantify marginal land for the Contiguous United States (CONUS) based on a history of satellite-observed land use change (LUC) over the 2008–2015 period. Frequent LUC between crop and noncrop is assumed to be an indicator of economically marginal land; this land is also likely to have a lower opportunity cost of conversion from food crop to bioenergy crop production. We first present an approach to identify cropland in transition using the time seriesmore »« less
https://doi.org/10.1021/acs.est.1c02236

Full Text Available
Land Use in Computable General Equilibrium Models

Journal Article Taheripour, Farzad ; Zhao, Xin ; Horridge, Mark ; ... - Journal of Global Economic Analysis

Constant Elasticity of Transformation (CET) functions are widely used to allocate land across uses in Computable General Equilibrium (CGE) models. These models fail to maintain area of land in balance. Several ways have been used or offered to fix this problem. This paper first examines the extent to which the CET approach may generate imbalances in area of land and identifies determinants of such imbalances. It then evaluates the merits, properties, and welfare impacts of the available approaches that restore area of land in balance. We show that heterogeneity in land prices (land rents) is the main source of imbalancemore »« less
https://doi.org/10.21642/JGEA.050202AF

Similar Records