Carbon farming economics: What have we learned?. (1st May 2016)

• Record Type: Journal Article
• Authors: Tang, Kai; Kragt, Marit E.; Hailu, Atakelty; Ma, Chunbo
• Is Part Of: Journal of environmental management. Volume 172(2016)
• Page Start: 49
• Page End: 57
• Publication Date: 2016-05-01
• Subjects: Agricultural GHG mitigation -- Economic analyses -- Biophysical models -- Cost estimates -- Policy incentives; Environmental policy -- Periodicals; Environmental management -- Periodicals; Environment -- Periodicals; Ecology -- Periodicals; 363.705
• DOI: 10.1016/j.jenvman.2016.02.008
• Languages: English
• ISSNs: 0301-4797

Abstract

Abstract: This study reviewed 62 economic analyses published between 1995 and 2014 on the economic impacts of policies that incentivise agricultural greenhouse (GHG) mitigation. Typically, biophysical models are used to evaluate the changes in GHG mitigation that result from landholders changing their farm and land management practices. The estimated results of biophysical models are then integrated with economic models to simulate the costs of different policy scenarios to production systems. The cost estimates vary between $3 and $130/t CO2 equivalent in 2012 US dollars, depending on the mitigation strategies, spatial locations, and policy scenarios considered. Most studies assessed the consequences of a single, rather than multiple, mitigation strategies, and few considered the co-benefits of carbon farming. These omissions could challenge the reality and robustness of the studies' results. One of the biggest challenges facing agricultural economists is to assess the full extent of the trade-offs involved in carbon farming. We need to improve our biophysical knowledge about carbon farming co-benefits, predict the economic impacts of employing multiple strategies and policy incentives, and develop the associated integrated models, to estimate the full costs and benefits of agricultural GHG mitigation to farmers and the rest of society. Highlights: The study reviews empirical economic journal papers of agricultural GHG mitigation. Many studies integrate biophysical and economic models in their analysis process. Mitigation costs vary depending on strategies types, locations, and policy scenarios. Few studies consider the co-benefits of carbon farming in their analyses. Few studies evaluate the integrated impacts of multiple mitigation strategies.