Preservation of agricultural soils with endogenous stochastic degradation
dc.contributor.author
Bretschger, Lucas
dc.contributor.author
Vinogradova, Alexandra
dc.date.accessioned
2019-05-29T10:02:07Z
dc.date.available
2017-06-11T23:22:30Z
dc.date.available
2017-11-16T14:45:49Z
dc.date.available
2019-05-29T10:02:07Z
dc.date.issued
2016-02
dc.identifier.uri
http://hdl.handle.net/20.500.11850/110950
dc.identifier.doi
10.3929/ethz-a-010590640
dc.description.abstract
Soils are often subject to environmental shocks which are caused by negative externalities linked to overexploitation. We present a stochastic model of a dynamic agricultural economy where natural disasters are sizeable, multiple, and random. Expansion of agricultural activities raises effective soil units (an index of quality and quantity) but contributes to an aggregate loss of soil-protective ecosystem services, which increases the extent of soil degradation at the time of a shock. We provide closed-form analytical solutions and show that optimal development is characterized by a constant growth rateof effective soil units and crop consumption until an environmental shock arrives causing both variables to jump downwards. Optimal policy consists of spending a constant fraction of output on soil preservation. This fraction is an increasing function of the shocks arrival rate, degradation intensity of agricultural practices, and the damage intensity of environmental impact. Implications for the optimal propensity to save are also discussed. An extension of the model provides a solution for the optimal preservation policy when both the hazard rate and damages are endogenous.
en_US
dc.format
application/pdf
en_US
dc.language.iso
en
en_US
dc.publisher
ETH Zurich, Center of Economic Research (CER-ETH)
en_US
dc.rights.uri
http://rightsstatements.org/page/InC-NC/1.0/
dc.subject
Soil conservation
en_US
dc.subject
Stochastic degradation
en_US
dc.subject
Agriculture
en_US
dc.subject
Environment
en_US
dc.subject
Uncertainty
en_US
dc.subject
Natural disasters
en_US
dc.title
Preservation of agricultural soils with endogenous stochastic degradation
en_US
dc.type
Working Paper
dc.rights.license
In Copyright - Non-Commercial Use Permitted
dc.date.published
2016
ethz.journal.title
Economics Working Paper Series
ethz.journal.volume
16/232
en_US
ethz.size
33 p.
en_US
ethz.code.ddc
DDC - DDC::6 - Technology, medicine and applied sciences::630 - Agriculture
en_US
ethz.code.jel
JEL - JEL::Q - Agricultural and Natural Resource Economics; Environmental and Ecological Economics::Q1 - Agriculture::Q18 - Agricultural Policy; Food Policy
en_US
ethz.code.jel
JEL - JEL::Q - Agricultural and Natural Resource Economics; Environmental and Ecological Economics::Q5 - Environmental Economics::Q54 - Climate; Natural Disasters and Their Management; Global Warming
en_US
ethz.code.jel
JEL - JEL::O - Economic Development, Innovation, Technological Change, and Growth::O1 - Economic Development::O13 - Agriculture; Natural Resources; Energy; Environment; Other Primary Products
en_US
ethz.code.jel
JEL - JEL::O - Economic Development, Innovation, Technological Change, and Growth::O4 - Economic Growth and Aggregate Productivity::O44 - Environment and Growth
en_US
ethz.publication.place
Zurich
en_US
ethz.publication.status
published
en_US
ethz.leitzahl
ETH Zürich::00002 - ETH Zürich::00012 - Lehre und Forschung::00007 - Departemente::02120 - Dep. Management, Technologie und Ökon. / Dep. of Management, Technology, and Ec.
en_US
ethz.leitzahl
ETH Zürich::00002 - ETH Zürich::00012 - Lehre und Forschung::00007 - Departemente::02120 - Dep. Management, Technologie und Ökon. / Dep. of Management, Technology, and Ec.::03635 - Bretschger, Lucas (emeritus) / Bretschger, Lucas (emeritus)
en_US
ethz.leitzahl.certified
ETH Zürich::00002 - ETH Zürich::00012 - Lehre und Forschung::00007 - Departemente::02120 - Dep. Management, Technologie und Ökon. / Dep. of Management, Technology, and Ec.::03635 - Bretschger, Lucas (emeritus) / Bretschger, Lucas (emeritus)
ethz.date.deposited
2017-06-11T23:22:47Z
ethz.source
ECOL
ethz.source
ECIT
ethz.identifier.importid
imp59366b87ac9c513245
ethz.identifier.importid
imp593653fd9f74d53702
ethz.ecolpid
eth:48648
ethz.ecitpid
pub:172260
ethz.eth
yes
en_US
ethz.availability
Open access
en_US
ethz.rosetta.installDate
2017-07-25T10:24:41Z
ethz.rosetta.lastUpdated
2019-05-29T10:02:21Z
ethz.rosetta.versionExported
true
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