Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/192173 
Year of Publication: 
1997
Series/Report no.: 
Discussion Papers No. 189
Publisher: 
Statistics Norway, Research Department, Oslo
Abstract: 
In this paper, a model of the nitrogen cycle in the soil is incorporated in a Computable General Equilibrium (CGE) model of the Tanzanian economy, thus establishing a two way link between the environment and the economy. For a given level of natural soil productivity, profit maximising farmers choose a production technique and the optimal production volume, which in turn influences the soil productivity the following years through the recycling of nitrogen from the residues of roots and stover and the degree of erosion. The model is used to simulate the effects of typical structural adjustment policies: a reduction in agro-chemicals subsidies, reduced implicit export tax rate, a devaluation of the currency, a cut in governmental expenditure and a reduction of foreign transfers. The result of a joint implementation is a 9 percent higher GDP level compared to the baseline scenario after 10 years. The effect of soil degradation is found to represent a reduction in the GDP level of more than 5 percent for the same time period.
Subjects: 
CGE-model
soil degradation
economic growth
structural adjustment
JEL: 
C68
Q16
Q24
Document Type: 
Working Paper
Document Version: 
Digitized Version

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