Agricultural economy: Difference between revisions

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|InputVar=Population; GDP per capita; Capital supply; Labor supply; Trade policy;  Biofuel policy; Land supply; Crop and grass yield - grid; Technological change (crops and livestock); Income and price elasticities of agricultural commodities demand; Land for bioenergy;
|InputVar=Population; GDP per capita; Capital supply; Labor supply; Trade policy;  Biofuel policy; Land supply; Crop and grass yield - grid; Technological change (crops and livestock); Income and price elasticities of agricultural commodities demand; Land for bioenergy;
|OutputVar=Crop production; Management intensity crops; Management intensity livestock; Food availability per capita; Commodity price; Livestock production;  Demand (crop and lifestock); Trade (crop and livestock);
|OutputVar=Crop production; Management intensity crops; Management intensity livestock; Food availability per capita; Commodity price; Livestock production;  Demand (crop and lifestock); Trade (crop and livestock);
|Description=Expansion of agricultural land is one of the most important and visible alterations to the natural environment, leading to greenhouse gas emissions, losses in biodiversity and ecosystem services, and nutrient imbalances. It is driven by the production of food, feed, fibres and other products, such as bio-energy and timber, resulting from trade and the domestic demand for these products. As in the past, agricultural production is expected to increase strongly, also in the coming decades, as a result of a growing world population and higher per-capita consumption. Despite the expected increasing agricultural yields and efficiency improvements, this will still lead to an increasing demand for agricultural land. To reduce the associated environmental impacts, efforts to further increase agricultural yields and reduce deforestation are required urgently, but currently lack sufficient political support.   
|Description=As a result of the growing world population and higher per capita consumption, production of food, feed, fibres and other products, such as bio-energy and timber will need to increase rapidly in the coming decades. Even with the expected improvements in agricultural yields and efficiency, there will be increasing demand for more agricultural land. However expansion of agricultural land will lead to increases in greenhouse gas emissions, loss of biodiversity and ecosystem services, and nutrient imbalances. To reduce these environmental impacts, action is needed urgently to increase agricultural yields further and to reduce deforestation requires political support.  
Within the IMAGE framework, future development of the agricultural economy is calculated by the agro-economic model [[MAGNET model|MAGNET]] (formerly LEITAP) ([[Woltjer et al., 2011]]). MAGNET, a computable general equilibrium ([[CGE]]) model, is connected via a soft linkage to the core model of IMAGE. Demographic development and increasing income lead to a change in the demand for all commodities including those in agriculture. On the supply side, agricultural production responds to this changing demand, also taking into account prices of production factors, resource availability and technological progress. In the model, agricultural production is delivering to over domestic uses and to foreign regions via international trade, depending on historical trade balances, competitiveness (relative price developments), transport costs and trade policies. The MAGNET model uses information from IMAGE on land availability and suitability, and on the change in crop yields due to climate change and agricultural expansion on inhomogeneous land areas. IMAGE, in turn, uses production and endogenous yield (management factor) results from MAGNET to calculate spatially explicit land-use change, and the environmental impacts on carbon, nutrient and water cycles, biodiversity, and climate. Although MAGNET is the standard agro-economic model coupled to IMAGE, it is possible to use other models, coupled in a similar way via soft-linkage. For example, the IMPACT model has been used together with IMAGE in the Millennium Ecosystem Assessment project ([[Carpenter, 2006]]), and in a PBL study on protein supply, allowing for a comparison with MAGNET ([[Stehfest et al., 2013]]).
 
In IMAGE, the demand for forest products can be derived from several sources. In the most simple case, via a relation with GDP, or, preferably, from specific forest demand models such as [[EFIGTM model|EFI-GTM]] ([[Kallio et al., 2004]]). In the future, it will become possible to account for full competition between forestry and other land uses, using the forestry module of MAGNET. Other land-use changes, such as expansion of infrastructure, which do not require interregional connections, are described in the land-use allocation module [[Agricultural systems]].
  In IMAGE, future development of the agricultural economy can be calculated using the agro-economic model [[MAGNET model|MAGNET]] (formerly LEITAP) ([[Woltjer et al., 2011]]). MAGNET is a computable general equilibrium ([[CGE]]) model that is connected via a soft link to the core model of IMAGE.
Demographic changes and rising incomes are the primary driving factors of the model, and lead to increasing and changing demand for all commodities including agricultural commodities. In response to changing demand, agricultural production is increasing, and the model also takes into account changing prices of production factors, resource availability and technological progress. In MAGNET, agricultural production supplies domestic markets, and other countries and regions are supplied via international trade, depending on historical trade balances, competitiveness (relative price developments), transport costs and trade policies.  
 
MAGNET uses information from IMAGE on land availability and suitability, and on changes in crop yields due to climate change and agricultural expansion on inhomogeneous land areas. The results from MAGNET on production and endogenous yield (management factor) are used in IMAGE to calculate spatially explicit land-use change, and the environmental impacts on carbon, nutrient and water cycles, biodiversity, and climate.  
 
Although MAGNET is the standard agro-economic model used with IMAGE, other models can be linked with IMAGE. For example, the IMPACT model was used with IMAGE in the Millennium Ecosystem Assessment ([[Carpenter, 2006]]), and in a PBL study on protein supply, both the MAGNET and the IMPACT model were used to study the same set of scenarios. This allowed a systematic comparison between IMPACT and MAGNET ([[Stehfest et al., 2013]]).
 
In IMAGE, demand for forest products can be derived from several sources, the most simplest being via a relationship with GDP or preferably, from specific forest demand models, such as [[EFIGTM model|EFI-GTM]] ([[Kallio et al., 2004]]). In the future, competition between forestry and other land uses can be included using the forestry module in MAGNET. Other land-use changes, such as infrastructure expansion, which do not require interregional links, are described in the land-use allocation module [[Agricultural systems]].
|ComponentCode=AEF
|ComponentCode=AEF
|AggregatedComponent=Agriculture and land use
|AggregatedComponent=Agriculture and land use
|FrameworkElementType=pressure component
|FrameworkElementType=pressure component
}}
}}

Revision as of 17:44, 10 February 2014

Link to framework components overview

Parts of Agricultural economy

  1. Introduction page
  2. Model description
  3. Policy issues
  4. Data, uncertainty and limitations
  5. Overview of references
Component is implemented in:
Components:
Related IMAGE components
Projects/Applications
Key publications
References
MAGNET- the agro-economic model in IMAGE 3.0
Flowchart Agricultural economy. See also the Input/Output Table on the introduction page.

Key policy issues

  • What is the area of cropland and grassland required to support future food demand?
  • What are the policy options to reduce agricultural land use and to safeguard global biodiversity, while ensuring food security?
  • How can the implications of biofuels for land use and greenhouse gases be managed sustainably?

Introduction

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