PNNL

Abstract

The theoretical difference in land use modeling approaches is an important uncertain factor in evaluating future climate scenarios in global economic and integrated assessment models. In this study, we compared several widely used land use modeling approaches including constrained optimization, constant elasticity of transformation (CET), the additive form of constant elasticity of transformation (ACET), logit, and Ricardian. We demonstrated that the approaches differ not only by the extent of parameter uses but also by the definition of conversion cost and the consideration of comparative advantage implied by land heterogeneity. We developed a generalized hybrid approach by incorporating ACET/logit and Ricardian to consider both conversion cost and comparative advantage. The hybrid approach was used to estimate future climate impacts on agriculture. The results indicated a welfare loss of 20 – 24 percent of crop value. It also demonstrated that ignoring land heterogeneity or land conversion cost would underestimate climate impacts on agriculture.