Publikationen
Es wurden 2 Publikationen gefunden
Knoke, T.; Paul, C.; Härtl, F.; Castro, L.M.; Calvas, B. & Hildebrandt, P. (2015): Optimizing agricultural land-use portfolios with scarce data—A non-stochastic model. Ecological Economics 120, 250-259.
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DOI: 10.1016/j.ecolecon.2015.10.021
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Abstract:
Abstract:
The theory of portfolio selection has often been applied to help improving decisions on the environment. The information required to apply this theory includes data on covariance of the uncertain returns between all combinations of the economic options and normally distributed returns. As it may be problematic to fulfil all data requirements and assumptions, the paper proposes a variant of robust portfolio optimization as an alternative. It considers future uncer-tainties in a non-stochastic fashion by means of possible deviations from the nominal return of land-use alternatives. The maximization of the economic return of the land-use portfolio is conditional to meeting an inclusive set of constraints. These demand that the same, whenever possible high, proportion of a required return threshold is achieved by means of the robust solution for each deviation scenario considered. The paper compares the land-use portfolios derived non-stochastically with portfolios generated by classical stochastic mean-variance op-timization. Based on data for eight agricultural crops typical for the Ecuadorian lowlands the results show that, depending on the deviation scenario assumed, the robust portfolios show a greater Shannon index compared to classical portfolios. For the same standard deviation of returns (derived through the classical sum of all covariances) the robust portfolios show no more than 2-5% loss in economic return in most cases. Occasionally, the loss has been higher, up to 20%. In this case the Shannon index was about 2.5 times higher compared with that of the conventional portfolio. The highly diverse portfolio achieved a much better protection against low relative performance. The results obtained show that the non-stochastic derivation of land-use portfolios is a good alternative to the classical stochastic model, whenever eco-nomic information is scarce.
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Keywords: |
land use |
diversification |
sustainable land use |
land use modeling |
Portfolio Theory |
Castro, L.M.; Calvas, B.; Hildebrandt, P. & Knoke, T. (2012): Avoiding the loss of shade coffee plantations: how to derive conservation payments for risk-averse land-users. Agroforestry Systems online, online.
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DOI: 10.1007/s10457-012-9554-0
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Abstract:
Abstract:
We usually have only limited knowledge about the economic consequences of land-use decisions, thus they are uncertain. We analyze the implications of this uncertainty on conservation payments (CP) to preserve wildlife-friendly shade coffee production in southwest Ecuador, when conversion to maize is the most profitable alternative. Our objective is twofold: First, we analyze the consequences of
applying Stochastic Dominance (SD) to derive CP, an approach making only minimal assumptions about the preferences of farmers. Second, we investigate the effects of land-use diversification to reduce CP by allowing for shade coffee on part of a landholding, and
maize production on what remains. CP derived by SD turned out to be at least twice the amount calculated by an alternative method which maximizes a concave utility function?US$ 166 to US$ 294 ha-1 year-1 instead of US$ 86 ha-1 year-1. Given this result, we
doubt that the assumptions underlying SD are reasonable for farmers, who are known to be riskaverse. Allowing for land-use diversification has a significant impact on CP. The optimal portfolio share of shade coffee is 27 % and for maize 73 % for
moderately risk-averse farmers?without any CP. A larger share of shade coffee is preferable for strongly risk-averse farmers?51 and 49 % maize. The amount of CP necessary to encourage the expansion of shade coffee to 75 %is US$ 40 ha-1 year-1 (for moderately
risk-averse) and US$ 19 ha-1 year-1 (for strongly risk-averse farmers). Stimulating diversification may thus help to significantly reduce CP necessary to preserve less profitable agroforestry options.
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Keywords: |
Biodiversity conservation |
Agroforestry |
conservation payments |
uncertainty |
diversification |
mean–variance |
stochastic dominance |