Macroeconomic models and soil erosion

Soil erosion generates on‐site costs that directly affect farming land. These costs are paid by farmers, through loss of fertile land. The on‐site costs are mainly the value of future lost production due to the decline in soil resources. These include losses in production, yields, and nutrients, damage to plantations, and reduction of the available planting area. Soil erosion also generates off‐site costs as a consequence of sedimentation, flooding, landslides, and water eutrophication. These costs are generally incurred away from the farm and are paid by society. The off‐site effects of soil erosion include the siltation of reservoirs, sediment impacts on fisheries, the loss of wildlife
habitat and biodiversity, increased risk of flooding, damage of recreational activities, land abandonment, and destruction of infrastructure such as roads, railways, and other public assets.

JRC in collaboration with Euro‐Mediterranean Center on Climate Change and University of Milan has integrated the biophysical model (for soil erosion ) with Computable General Equilibrium (CGE) Macroeconomic model to estimate costs of agricultural productivity loss due to soil erosion.

Panagos, P., Standardi, G., Borrelli, P., Lugato, E., Montanarella, L., Bosello, F. 2018. Cost of agricultural productivity loss due to soil erosion in the European Union: From direct cost evaluation approaches to the use of macroeconomic modelsLand Degradation and Development, 29(3): 471-484