M.A. Keyzer

Biofuel development, food security and the use of marginal land in China.

With concerns of energy shortages, China, like the United States, European Union, and other countries, is promoting the development of biofuels. However, China also faces high future demand for food and feed, and so its bioenergy program must try to strike a balance between food and fuel. The goals of this paper are to provide an overview of Chinas current bioethanol program, identify the potential for using marginal lands for feedstock production, and measure the likely impacts of Chinas bioethanol development on the nations future food self-sufficiency. Our results indicate that the potential to use marginal land for bioethanol feedstock production is limited. Applying a modeling approach based on highly disaggregated data by region, our analysis shows that the target of 10 million t of bioethanol by 2020 seems to be a prudent target, causing no major disturbances in Chinas food security. But the expansion of bioethanol may increase environmental pressures due to the higher levels of fertilizer use. This study shows also that if China were able to cultivate 45% of its required bioethanol feedstock on new marginal land, it would further limit negative effects of the bioethanol program on the domestic and international economy, but at the expense of having to apply another 750 thousand t of fertilizer.

The impact of climate change on crop production in West Africa : An assessment for the Oueme River Basin in Benin

Climate change studies for West Africa tend to predict a reduced potential for farming that will affect the food security situation of an already impoverished population. However, these studies largely ignore farmers’ adaptations and market adjustments that mitigate predicted negative effects. The paper attempts to fill some of this gap through a spatially explicit evaluation of the impact of climate change on farm income in the Oueme River Basin (ORB), Benin. The ORB is in many respects representative for the middle belt of West Africa where the predominantly sparse occupation leaves potential for migration from more densely populated areas. We apply a number of structural, spatially explicit relationships estimated for the whole territory of Benin to simulate conditions in the ORB proper that are similar to those currently prevailing in the drier North, and the more humid South. Our scenario results factor out for the main crops cultivated the constituent effects on yields, area, and revenue per ton. We find that under average climate change conditions the current low yields are not reduced, provided that cropping patterns are adjusted, while price increases partly compensate for the remaining adverse effects on farmer income. Consequently, without any policy intervention, farm incomes remain relatively stable, albeit at low levels and with increased occurrence of crop failures after extreme droughts. Scenario simulations show that there are also beneficial aspects that can, with adequate interventions, even turn losses into gains. Main channel for improvement would be the reduction of fallow, which is particularly promising because it requires few adjustments in prevailing farming practices, exploits the potential of uncultivated land and improves the water use efficiency. It also enables the Basins capacity to absorb future migrant flows from more severely affected neighboring Sahelian areas.

Safety Nets and Index-Based Insurance: Historical Assessment and Semiparametric Simulation for Northern Ghana

This article considers index‐based safety nets aimed at assuring participants a minimum income at the village level, set by a prespecified poverty line. The participating villages collectively manage a pooled budget, offering an index‐based per capita indemnity to the villages financed from a uniform per hectare premium, possibly supplemented by an external subsidy. The scheme involves implicit cross‐subsidies in favor of the poorest villages. Otherwise, it focuses on covariate risk, leaving it to mutual arrangements to deal with intravillage idiosyncratic risk. Its design is obtained from a risk‐minimizing model for the collective of villages with constraints of two kinds. The first is the budget that ensures that payments receive adequate finances. The second concerns the set of admissible schedules requiring that payments are triggered by a flexible function of only a few variables. For this we propose a semiparametric form from kernel learning, noting its capacity to combine a priori on the impact of shocks via the parametric term, with a flexible fit to the data at hand via the nonparametric term. To test the approach, we estimate and simulate an index‐based safety net for northern Ghana, constructing a pseudovillage panel from four rounds of household surveys and assembling all villages in a single risk pool. Results of a fully self‐financed arrangement indicate a reduction by 20 percentage points of the poverty incidence from an initial level of 63% and are robust under resampling. Yet, for the given typology of villages, this arrangement requires an unrealistically high premium and large cross‐subsidies. We show that both can be reduced significantly when a moderate external subsidy is allowed for. Nonetheless, in all cases, the basis risk remains considerable, reflecting the limited capacity of the selected price and weather variables to eliminate poverty.

On Convergence of Kernel Learning Estimators

The paper studies convex stochastic optimization problems in a reproducing kernel Hilbert space (RKHS). The objective (risk) functional depends on functions from this RKHS and takes the form of a mathematical expectation (integral) of a nonnegative integrand (loss function) over a probability measure. The problem is generally ill-posed, a difficulty that in statistical learning is addressed through Tihonov regularization, with Monte Carlo approximation of integrals, which also makes it possible to solve the problem by finite dimensional (convex) quadratic optimization. The approximate solutions are referred to as kernel learning estimators and are expressed as a linear combination of kernels evaluated at the sample points. They are functional random variables that depend on the full sample. The paper studies a probabilistic convergence of these approximate solutions under a gradual elimination of the regularization parameter with rising number of observations. Its intended contribution is to derive novel nonasymptotic bounds on the minimization error and exponential bounds on the tail distribution of errors and to establish novel sufficient conditions for uniform convergence of kernel estimators to the true (normal) solution with probability one, jointly with a rule for downward adjustment of the regularization factor with increasing sample size. Applications to least squares, median, and quantile regression estimation, as well as to binary classification, are discussed.

Farming and Rural Development in Ukraine: making dualisation work

Rural economy 1. Following the decollectivisation of agriculture in Ukraine, the dualisation between very large commercial farms and small individual farms has become a prevalent trend in the rural areas of Ukraine. 2. Rural farm households would need larger plots. They could benefit from mechanization. 3. Yet, as their crop yields are low and lie close to those of large farms that use far more chemical inputs and machinery, the area expansion could be kept modest. 4. Distribution of land ownership rights and cadastral registration need to be supplemented by introduction and registration of other formal titles such as the right of passage and the user rights in commons. 5. Shareholders of a large farm do not need to know the precise location of their property within the farm. Explicit cadastral registration of parcels into units smaller than the individual field is wasteful. 6. Land users should be made to pay due rent to landowners, private (e.g. pensioners), and public (e.g. municipalities), and no longer predominantly in kind. This could improve social safety nets, stimulate activities in rural villages, and improve the fiscal revenue of local governments. 7. Corporate farms should pay corporate taxes. 8. Since growth in employment has been stagnating in urban areas, rural areas have to provide for it, partly in horticulture, animal husbandry and agricultural processing, and partly in expanded household farms, possibly as small multi-household enterprises or cooperatives, on land returned from commercial farms. Foreign trade 9. Access to exports should be made available to all who deliver goods of adequate quality, and not only to specific trading companies who can get access to export licenses. 10. Product labelling on exports, could with adequate inspections, with labels requiring satisfaction of social as well as environmental standards, provide effective means to complement and support local governance. 11. Ukraine has considerable scope to step up its exports of grain and oilseeds, which might significantly contribute to world food security. Yet, to effectuate this expansion without amplifying prevailing price volatility, Ukraine will have to enhance its management of irrigation, storage and plant protection, to limit its support to biofuels and to abstain from imposition of export bans in response to shortfalls. Nutrient management 12. Large exports amount to large outflow of plant nutrients, and turn recycling and imports of nutrients into a necessity in preventing soil fertility loss and land degradation. Expansion of livestock activities with proper manure management also helps to compensate for this loss. Statistics and governance 13. There is domestic and foreign demand for independent and reliable information on prevailing social and environmental conditions, and trade regimes in Ukraine. A data platform that makes use of the available surveys, and avails of some capacity to conduct new ones could help meeting this need.

Unlocking Ukraine’s Production Potential

Rural areas in Ukraine are facing a strong dualisation between large corporate farms that often belong to even larger agro-holdings, the modern successors of kolkhozes, on the one hand, and private farms on the other hand, the latter of which comprise a smaller number of relatively dynamic commercial farms and a multitude of small household farms that largely produce for subsistence. This dualization is a reality that cannot be reversed, but there is an urgent need to halt the further concentration as well as the continued fragmentation of holdings, to make export licences available more freely and openly and to stop the persistent loss of soil fertility that results from intensive cultivation without adequate nutrient replenishment. These are only some of the steps required to unlock Ukraine’s production potential and to enable dualised systems to operate more effectively and sustainably. Policies will also have to take into account the fact that agro-holdings currently appear to be far more financially vulnerable now than they seemed to be a few years ago. At any rate, from 2014 onwards, the conflict in the eastern part of the country overshadowed much of all this; this chapter ends with a number of suggestions on how a less ambitious agenda for trade agreements might help reduce some of the tensions.

A Gradient‐Related Algorithm for Solving Large Scale, Spatially Explicit, Welfare Models with Transportation

This paper presents a gradient‐related algorithm for solving large scale, spatially explicit, welfare models with transportation. It introduces the theory, describes the different components of the algorithm, and reports on experience gained in applying it.