The role of uncertainty and expectations in modeling (range)land use strategies: An application of dynamic optimization modeling with recursion

Domptail, Stéphanie; Nuppenau, Ernst‐August

doi:10.1016/j.ecolecon.2010.07.024

Cited by 23 publications

(8 citation statements)

References 32 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…To mitigate negative impact of uncertainty show that number of livestock has continuously to be adapted to current weather conditions to improve income and reduce risk. Applying a bio-economic model to simulate rangeland management in Namibia, Domptail and Nuppenau (2010) conclude that a good way to mitigate impact of weather risk is to minimize herd size adjustment costs and to expect low-rainfall when choosing the size of the herd. Applying a system dynamic model Payne et al (2009) argue that beef cow operations in Texas face high uncertainties that can be reduced by changes in the calving season.…”

Section: Introductionmentioning

confidence: 99%

Bio-economic modelling of decisions under yield and price risk for suckler cow farms

Briner

Finger

2015

Anim. Prod. Sci.

View full text Add to dashboard Cite

Applying a bio-economic whole-farm model, we assess the impact of price and weather risk as well as different risk-management strategies on the variability of the gross margin in Swiss suckler cow production. For instance, flexible adjustment of fodder composition, feed stocks, or land use as well as gross margin insurance are considered. Our results show that assuming moderate risk aversion farms’ gross margin variability is rather high, with a coefficient of variation of gross margin ranging from 19 to 21%. Accounting for on-farm risk-management strategies we find that gross margin variability can be reduced significantly, causing only low reductions of average gross margin levels. We find that the use of maize as a switch crop and a market for the trade of roughage are the most efficient risk-management strategies. Our results also indicate that gross margin insurance is not attractive for farmers. Thus in particular promoting better access to markets for feedstuffs provides a valuable opportunity for farmers to manage gross margin risks.

show abstract

Section: Introductionmentioning

confidence: 99%

Bio-economic modelling of decisions under yield and price risk for suckler cow farms

Briner

Finger

2015

Anim. Prod. Sci.

View full text Add to dashboard Cite

show abstract

“…Similarly, Heidhues (1966) used a recursive approach to study the adaptation of investment and sales decisions to changes in crop prices due to policy measures. Domptail and Nuppenau (2010) adjusted in a recursive process herd size and the purchase of supplemental fodder once a year depending on the available biomass that depended directly on rainfall. In a study of a dairy-beef-sheep farm in Northern Ireland, Wallace and Moss (2002) examined the effect of possible breakdowns due to bovine spongiform encephalopathy on animal sale and machinery investment decisions over a 7-year period with linear programming and a recursive process.…”

Section: Adaptations and Strategic Decisions For The Entire Farmmentioning

confidence: 99%

Processes of adaptation in farm decision-making models. A review

Robert¹,

Thomas

Bergez³

2016

Agron. Sustain. Dev.

View full text Add to dashboard Cite

Agricultural production systems should evolve fast to cope with risks induced by climate change. Farmers should adapt their management strategies to stay competitive and satisfy the societal demand for sustainable food systems. It is therefore important to understand the decision-making processes used by farmers for adaptation. Processes of adaptation are in particular addressed by bio-economic and bio-decision models. Here, we review bio-economic and bio-decision models, in which strategic and tactical decisions are included in dynamic adaptive and expectation-based processes, in 40 literature articles. The major points are: adaptability, flexibility, and dynamic processes are common ways to characterize farmers' decisionmaking. Adaptation is either a reactive or a proactive process depending on farmer flexibility and expectation capabilities. Various modeling methods are used to model decision stages in time and space, and some methods can be combined to represent a sequential decision-making process.

show abstract

“…Therefore, the following optional components of the suggested conceptual model as basis for site-specific land usages are suggested (see Fig. 1) Given that uncertainty (e.g., Domptail and Nuppenau, 2010) always exists in ecosystems and ecosystem interdependency measurements, monitoring, modeling, valuation and management, we should continuously gather and integrate relevant information with the goal of learning and adaptive improvement. To do this, it is necessary to constantly evaluate the effects of existing systems and design new systems with stakeholder participation as experiments.…”

Section: Discussionmentioning

confidence: 99%