Uncertainty and Sustainability in the Management of Rangelands

32 Pages Posted: 21 Mar 2006 Last revised: 27 Apr 2009

See all articles by Martin F. Quaas

Martin F. Quaas

German Centre for Integrative Biodiversity Research (iDiv) Halle-Jena-Leipzig

Stefan Baumgärtner

University of Freiburg - Department of Environment and Natural Resources

Christian U Becker

Colorado State University

Karin Frank

Helmholtz Centre for Environmental Research - UFZ, Leipzig

Birgit Müller

UFZ - Helmholtz Centre for Environmental Research Leipzig-Halle

Date Written: March 1, 2006

Abstract

We analyze a dynamic and stochastic ecological-economic model of grazing management in semi-arid rangelands. The ecosystem is driven by stochastic precipitation. A risk averse farmer chooses a grazing management strategy under uncertainty such as to maximize expected utility from farming income. Grazing management strategies are rules about which share of the rangeland is given rest depending on the actual rainfall in that year. In a first step we determine a myopic farmer's optimal grazing management strategy and show that a risk averse farmer chooses a strategy such as to obtain insurance from the ecosystem: the optimal strategy reduces income variability, but yields less mean income than possible. In a second step we analyze the long-run ecological and economic impact of different strategies. We conclude that a myopic farmer, if he is sufficiently risk-averse, will choose a sustainable grazing management strategy, even if he does not take into account long-term ecological and economic benefits of conservative strategies.

Keywords: Ecological-economic model, semi-arid rangeland, grazing management, risk aversion, uncertainty, sustainability

JEL Classification: Q57, Q12, Q24

Suggested Citation

Quaas, Martin F. and Baumgärtner, Stefan and Becker, Christian U. and Frank, Karin and Müller, Birgit, Uncertainty and Sustainability in the Management of Rangelands (March 1, 2006). Ecological Economics, Vol. 65, No. 2, 2007, Available at SSRN: https://ssrn.com/abstract=892103

Martin F. Quaas (Contact Author)

German Centre for Integrative Biodiversity Research (iDiv) Halle-Jena-Leipzig ( email )

Deutscher Platz 5e
Leipzig, 04103
Germany

HOME PAGE: http://www.idiv.de/bioecon

Stefan Baumgärtner

University of Freiburg - Department of Environment and Natural Resources ( email )

Tennebacher Str. 4
Freiburg, 79106
Germany

HOME PAGE: http://www.ere.uni-freiburg.de

Christian U. Becker

Colorado State University ( email )

College of Business
Fort Collins, CO 80526
United States

Karin Frank

Helmholtz Centre for Environmental Research - UFZ, Leipzig ( email )

Permoserstrasse 15
Leipzig, D-04318
Germany

Birgit Müller

UFZ - Helmholtz Centre for Environmental Research Leipzig-Halle ( email )

Permoserstrasse 15
D-04318 Leipzig
Germany

HOME PAGE: http://www.ufz.de/index.php?en=15522

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