Land Degradation as a Transformation Process in an Intertemporal Welfare Optimisation Framework

Abstract

An intertemporal social welfare optimisation framework proposed by Fischer et al. (1996) describes desirable scenarios of land use and land cover change in the future for China. This chapter intends to demonstrate that it is feasible to integrate a land degradation dimension into this framework, if the required quantitative data are available. We show how to incorporate the land degradation dimension into the profit maximisation process of a representative farm as part of resource management. Land units are categorised according to their soil and climate characteristics to represent the spatial heterogeneity. They can shift from higher quality classes to lower ones as a result of land degradation, while it is also possible to reverse this process by land conservation measures. Land degradation is treated as an integral element of an economic transformation function. The basic assumption is that users of the land farmers in particular notice the negative effect of land degradation on their production potentials. They are supposed to have opportunities to cancel these negative effects by investing in land and/or by increasing the volume of their input packages.