Poverty, Resource Scarcity and Incentives for Soil and Water Conservation: Analysis of Interactions with a Bio-economic Model
The paper examines the interlinkages between population pressure and poverty, possible impacts on household welfare and land management, and the consequent pathways of development in a low potential rural economy. A dynamic non-separable bio-economic model, calibrated using data from the Ethiopian highlands, is used to trace key relationships between population pressure, poverty and soil fertility management in smallholder agriculture characterized by high levels of soil degradation. Farm households maximize their discounted utility over the planning horizon. Land, labor and credit markets are imperfect. Hence, production, consumption and investment decisions are jointly determined in each period. The level of soil degradation is endogenous and has feedback effects on the stock and quality of the resource base. This may in turn influence land management choices. Under high population pressure, land becomes dearer relative to labor. This is likely to induce conservation investments, especially when conservation technologies do not take land out of production. When markets are imperfect, poverty in vital assets (e.g., oxen and labor) limits the ability or the willingness to invest in conservation and may lead to a less sustainable pathway. Boserup-type responses are more likely when (privately) profitable technologies exist and market imperfections do not limit farm-households' investment options.
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- Holden, Stein T. & Shiferaw, Bekele & Wik, Mette, 1998. "Poverty, market imperfections and time preferences: of relevance for environmental policy?," Environment and Development Economics, Cambridge University Press, vol. 3(01), pages 105-130, February.
- Shiferaw, Bekele & Holden, Stein T., 1998.
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Blackwell, vol. 18(3), pages 233-247, May.
- Shiferaw, Bekele & Holden, Stein T., 1998. "Resource degradation and adoption of land conservation technologies 1n the Ethiopian Highlands: A case study in Andit Tid, North Shewa," Agricultural Economics of Agricultural Economists, International Association of Agricultural Economists, vol. 18(3), May.
- Templeton, Scott R. & Scherr, Sara J., 1999. "Effects of Demographic and Related Microeconomic Change on Land Quality in Hills and Mountains of Developing Countries," World Development, Elsevier, vol. 27(6), pages 903-918, June.
- de Janvry, Alain & Fafchamps, Marcel & Sadoulet, Elisabeth, 1991. "Peasant Household Behaviour with Missing Markets: Some Paradoxes Explained," Economic Journal, Royal Economic Society, vol. 101(409), pages 1400-417, November.
- Grepperud, Sverre, 1996. "Population Pressure and Land Degradation: The Case of Ethiopia," Journal of Environmental Economics and Management, Elsevier, vol. 30(1), pages 18-33, January.
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