Land transformation analysis and application

Ruslana R. Palatnik, Iddo Kan, Mickey Rapaport-Rom, Andrea Ghermandi, Fabio Eboli and Mordechai Shechter ()

No 332155, Conference papers from Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project

Abstract: This study presents an internal modification of a dynamic computable general equilibrium model, ICES, employing inputs from a partial equilibrium model for agricultural sector, VALUE. The aim is to quantify and analyze the medium-term socio-economic consequences of projected climate change. The methodology is innovative as it combines state-of-the-art knowledge from economic and biophysical sources. Initially, to this end, the VALUE model is applied to two Mediterrenean countries: Israel and Italy. The information from VALUE model was incorporated in the economic model ICES to improve the agricultural production structure. The new land allocation method takes into account the variation of substitutability between different types of land use. It captures agronomic features included in the VALUE model. This modification gives a better representation of heterogeneous information of land productivity to the economic framework. Climate impacts and policy evaluation with ICES become reinforced due to the more refined system of land allocation. The originality of this exercise is our ability to base the analysis on empirically estimated parameters, which in other similar studies are mainly assumed or guessed. Notably, we suggest diverse land Constant Elasticity of Transformation (CET) frontiers to two main ecological regions in the Mediterranean basin, for more accurate representation of agronomic characteristics. With the modified ICES model we present an evaluation of climate change impact on agricultural production in the Mediterranean.

Keywords: Land Economics/Use; Environmental Economics and Policy (search for similar items in EconPapers)
Pages: 30
Date: 2011
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Persistent link: https://EconPapers.repec.org/RePEc:ags:pugtwp:332155

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