GLOBAL CHANGE AND THE CHALLENGES OF SUSTAINABLY FEEDING A GROWING PLANET

• Sponsoring Institution: National Institute of Food and Agriculture
• Project Status: COMPLETE
• Funding Source: HATCH
• Reporting Frequency: Annual
• Accession No.: 1003642
• Project Start Date: Oct 1, 2014
• Project End Date: Sep 30, 2019
• Program Code: [(N/A)]- (N/A)

Recipient Organization
PURDUE UNIVERSITY
(N/A)
WEST LAFAYETTE,IN 47907

Performing Department
Agricultural Economics

Non Technical Summary
Since the 2007/2008 commodity crisis, there has been a resurgence of interest in the sustainability of the world's food system and its contributions to feeding the world's population as well as to ensuring the environmental sustainability of the planet. The elements of this 'grand challenge' are by now quite familiar. The number of people which the world must feed is expected to increase by another 2 billion by 2050 (Bloom 2011). When coupled with significant nutritional improvements for the 2.1 billion people currently living on less than $2/day (World Bank 2008, p.1), this translates into a very substantial rise in the demand for agricultural production. FAO estimates the increased demand at 70 percent of current production, with a figure nearer 100% in the developing countries (Bruinsma 2009, p.2).Over the past century, global agriculture has managed to offer a growing population an improved diet, primarily by increasing productivity on existing cropland. However, a number of authors have documented signs of slowing yield growth for key staple crops (Byerlee and Deininger 2010, Box 2.1). And public opposition to genetically modified crops has slowed growth in the application of promising biotechnology developments to food production in some parts of the world. At the same time, the growing use of biomass for energy generation has introduced an important new source of industrial demand in agricultural markets (Energy Information Agency 2010). To compound matters, water, a key input into agricultural production, is rapidly diminishing in availability in many parts of the world (McKinsey & Co 2009), and many soils are degrading (Lepers et al. 2005).In addition, agriculture and forestry are increasingly envisioned as key sectors for climate change mitigation policy. When combined, farming and land use change - much of it induced by agriculture - currently account for about one-third of global greenhouse gas emissions (Baumert, Herzog, and Pershing 2005), but, if incorporated into a global climate policy, these sectors could contribute up to half of all mitigation in the near term, at modest carbon prices (Golub et al. 2009). Any serious attempt to curtail these emissions will involve changes in the way farming is conducted, as well as placing limits on the expansion of farming - particularly in the tropics, where most of the agricultural land conversion has come at the expense of forests, either directly (Gibbs et al. forthcoming)or indirectly via a cascading of land use requirements with crops moving into pasture and pasture into forest (Barona et al. 2010). Limiting the conversion of forests to agricultural lands is also critical to preserving the planet's biodiversity (Green et al. 2005). These factors will restrict the potential for agricultural expansion in the wake of growing global demands.Finally, agriculture and forestry are likely to be the economic sectors whose productivity is most sharply affected by climate change (Lobell, Schlenker, and Costa-Roberts 2011; Schlenker and Roberts 2009). This will shift the pattern of global comparative advantage in agriculture (Reilly et al. 2007)and may well reduce the productivity of farming in precisely those regions of the world where poverty and malnutrition are most prevalent (Thomas Hertel, Burke, and Lobell 2010), while increasing yield variability and the vulnerability of the world's poor (Syud A Ahmed, Diffenbaugh, and Hertel 2009).

Animal Health Component

80%

Research Effort Categories

Basic

(N/A)

Applied

80%

Developmental

20%

Classification

Knowledge Area (KA)	Subject of Investigation (SOI)	Field of Science (FOS)	Percent
605	0430	3010	50%
606	6120	3010	50%

Knowledge Area
605 - Natural Resource and Environmental Economics; 606 - International Trade and Development;

Subject Of Investigation
6120 - International economy and sectors thereof; 0430 - Climate;

Field Of Science
3010 - Economics;

Keywords

climate change

food security

food prices

land use

greenhouse gas emissions

international trade

bio-energy

sustainablility

Goals / Objectives
The broad objective of this project is to improve our understanding of the interplay between population and income growth, biofuels policy and production, international trade, climate impacts and climate policy in determining future food security, land use change and greenhouse gas (GHG) emissions at global and regional scales. Land-based GHG emissions account for about one-third of total GHG emissions and could offer up to 50% of efficient abatement potential at modest carbon prices. Yet current predictions of land use change and GHG emissions over the coming century are highly uncertain and often ignore economic factors altogether. Improving such predictions and developing coherent policy recommendations which account for the dynamic interplay between these forces is a high priority. In an effort to improve on the current state of knowledge and policies, the project has the following specific objectives:1. Understand and quantify the drivers of global changes in land use and greenhouse gas (GHG) emissions, project such changes forward to 2050 or 2100, and formulate optimal policy responses to such changes.2. Evaluate the impact of uncertainty in climate impacts, climate change mitigation policies and energy prices on both optimal and observed land use change at global scale over the long run.3. Assess the impact of future water shortages on global food production, trade and land use.4.Assess the impacts of these global changes on world food prices, food security, livelihoods and poverty in developing countries.

Project Methods
1.Understand and quantify the drivers of global changes in land use and greenhouse gas (GHG) emissions and project such changes forward to 2050 or 2100.Simplified International Model of agricultural Price, Land use and the Environment (SIMPLE)is a global, comparative static, partial equilibrium model of crop production, trade, land use, GHG emissions and food security. Baldos and Hertel (2013)have validated this model against the 1961-2006 period. The model captures global agriculture, including the predominance of yield growth over area expansion in driving output increases, as well as the secular decline in agricultural prices. The model has been used to understand the drivers behind long run agricultural output and price changes to 2050 (U. L. Baldos and Hertel 2013). SIMPLE also has a GHG module to assess the interplay between agricultural land use and GHG emissions to demonstrate that investments in agricultural adaptation can provide valuable mitigation benefits (Lobell, Baldos, and Hertel 2013).The SIMPLE model is flexible and robust, but limited in 2 ways. It does not explicitly model the competing uses for land over the long run (e.g., forestry, biofuels and environmental services from land such as biodiversity and recreation). A second limitation is that SIMPLE is not anintertemporalmodel. This is not a problem for modeling annual crops, but is problematic for forestry where trees can live for more than 100 years, and the question of when to harvest depends on their commercial as well as carbon sequestration value. It is also a problem for understanding the role of key technologies, such as second generation, drop-in biofuels, which are not presently commercially viable, but which could become so under future energy price or climate regulation scenarios.The FABLE model (Forest, Agriculture and Biofuels in a Land use model with Environmental services)is a dynamic optimization model for the world's land resources over the next century which brings together agronomic, economic, and biophysical literature into a single, intertemporally consistent, analytical framework, at global scale. FABLE solves for the dynamic paths of alternative land uses, which together maximize global economic welfare, subject to a constraint on global GHG emissions (Steinbuks and Hertel 2012). FABLE has been used to evaluate uncertainties in climate impacts, climate regulation and energy prices in determining optimal global land use and to demonstrate the impacts of second generation biofuels on global agriculture, GHGs and land use in the context of alternative assumptions about technology and global economic growth (Thomas Hertel, Steinbuks, and Baldos 2013). Since FABLE has very limited geographic disaggregation, this project will disaggregate it into more regions in collaboration with Brent Sohngen (B. Sohngen, Golub, and Hertel 2009; Sedjo and Sohngen 2009; Brent Sohngen 2010).Both the SIMPLE and FABLE models rely heavily on econometric studies based on historic data for key parameters (Muhammad et al. 2011; Keeney and Hertel 2009; Syud Amer Ahmed, Hertel, and Lubowski 2008). Both models assume integrated world markets with a long run single world price. Econometric analysis of world coarse grains markets suggests that this hypothesis does not hold in the short run (Villoria and Hertel 2011). Cross-section estimation of trade elasticities suggests that this assumption may also be incorrect over longer periods of time (Thomas Hertel et al. 2003). Further econometric work is needed to understanding how world developments are transmitted across markets.2.Evaluate the impact of uncertainty in climate impacts, climate change mitigation policies and energy prices on both optimal and observed land use change at global scale over the long run.The FABLE model has identified the critical role of petroleum and natural gas prices in determining the path of global land use change (Steinbuks and Hertel 2013). The effect of uncertainty in energy prices on future global land use is considerably larger than in the existing analyses of global land use which have largely focused on climate mitigation and energy policies as well as climate impacts. Energy prices affect the competitiveness of biofuels as well as the price of nitrogen fertilizers. By 2100, the global land area devoted to food and biofuels production is 400 million hectares larger under US-DOE baseline projections vs. the case of flat energy prices. The FABLE model also predicts that long run sensitivity of the optimal path for global crop land for food and biofuels' feed stocks with respect to uncertainty in energy price forecasts is 4 times higher as compared to variation in predicted climate impact on agricultural yields, and 2 times higher as compared to variation in GHG emissions targets. Understanding these sources of uncertainty and how they affect land use decisions over the long run is important.In prior work uncertainty was treated via alternative scenarios - e.g., high vs a low oil price path and aggressive climate regulation vs. no land-based regulation. Since most investors and policy makers are risk-averse, uncertainty will shape their actions regarding land use - particularly if such actions are irreversible, or expensive to change once made. To incorporate uncertainty into the decision making process, FABLE must be modified into a stochastic-dynamic implementation model. This will build on the work of Judd and his collaborators (Cai, Judd, and Lontzek 2013; Cai, Judd, and Lontzek 2012)who have developed an algorithm for solving high-dimensional stochastic-dynamic problems which is ideally suited to FABLE. Collaboration with Cai and Judd is underway in a NSF-funded project and will be extended to the disaggregated FABLE model discussed above.3.Assess the impact of future water shortages on global food production, trade and land use.The Global Trade Analysis Project (GTAP)model which disaggregates global land use by country and Agro-Ecological Zone (AEZ) as well as by River Basin (T. W. Hertel, Rose, and Tol 2009; Taheripour, Hertel, and Liu 2011; Liu et al. 2013)has shown that water scarcity and constraints on irrigation expansion can significantly alter the pattern of land use change resulting from US biofuels expansion (Taheripour, Hertel, and Liu 2013), and it can also change the pattern of bilateral trade in food products (Liu et al. 2013). Future work will emphasize a more complete representation of water supply and demand at the river basin level for the agricultural and non-agriculture sectors.4.Assess the impacts of these global changes on world food prices, food security, livelihoods and poverty in developing countries.The SIMPLE model has a module which characterizes the distribution of consumer expenditures on food within a region and has been validated against historical changes in nutrition over the 1991-2006 period. It has been used to understand the impact of projected future climate change and agricultural productivity growth on malnutrition in developing countries (U. L. C. Baldos and Hertel 2014). SIMPLE suffers from an important limitation. As a partial equilibrium model, it does not endogenize household incomes. The GTAP-POV (Thomas Hertel et al. 2011)framework will be used to assess the impacts of global change on poverty across seven different household strata in developing countries. This builds on the basic GTAP model (Thomas W. Hertel 1997)and incorporates detailed information on low income households in a sample of developing countries across Africa, Asia and Latin America. Previous applications have evaluated the poverty impacts of trade policy (Thomas W Hertel et al. 2009), climate change (Thomas W. Hertel, Burke, and Lobell 2010)and climate mitigation policies (Hussein, Hertel, and Golub 2013). Work is currently underway in collaboration with the Inter-American Development Bank to include nearly every country in the Latin America-Caribbean region.

Progress 10/01/14 to 09/30/19

Outputs
Target Audience:I reached a wide public audience through press releases and interviews with national media outlets, as well as apresentation at the Washington, DC meetings of the American Association for the Advancement of Science.I reached stakeholders in agriculture through a talks for the National Academy of Sciences, ERS/USDA, the FarmFoundation and the Mellon Foundation.I reached peers through invited talks at the AAEA and GTAP conferences.And I reached international audiences through talks at Cambridge University in the UK and the American University of Beirutin Lebanon Changes/Problems: Nothing Reported What opportunities for training and professional development has the project provided?I have trained a post-doc and a PhD student in global economic analysis of sustainblity. How have the results been disseminated to communities of interest?Chepeliev, Maksym, Alla Golub, Thomas Hertel and Wajiha Saeed, "GTAP-HS: Modeling Agricultural Trade Policy at theTariff Line" Presented at ERS/USDA, Washington, DC, August 14, 2019.Hertel, Thomas W., "International Trade and Sustainability", Presented to the Chicago Dialogue on Trade and Sustainabilityorganized by the Farm Foundation and the Canadian Agri-Food Policy Institute, Oak Brook, IL, July 31, 2019.Hertel, Thomas W., Laura Bowling, Iman Haqiqi and Jing Liu, "Global to Local to Global Analysis of Long Run Sustainability ofUS Agriculture", Presented to the Mellon Foundation Grand Challenges Conference, Purdue University, May 20, 2019.Hertel, Thomas W., based on joint work with Uris L.C. Baldos, "Managing the Global Commons: Sustainable Agriculture andthe Use of the World's Land and Water Resources in the 21st Century", Presented at the American University of Beirut,Lebanon, March 11, 2019.Hertel, Thomas W., "Global to Local Analysis of the United Nations Sustainable Development Goals", Presented at the AAASannual meetings, Washington, D.C., February 17, 2019.Hertel, Thomas W., based on joint work with Uris L.C. Baldos, "Market integration and future food security in the context ofspatially heterogeneous population and productivity growth", Presented at a Symposium on the New Malthusianism, JesusCollege, Cambridge University, UK, December 12, 2018.Emiliano Lopez-Barrera and T.W. Hertel, "Food Waste: A Global Perspective", Presented at the National Academies of Science, Washington, D.C. October 17, 2018. What do you plan to do during the next reporting period to accomplish the goals? Nothing Reported

Impacts
What was accomplished under these goals? We find that when we remove the spatial variation in climate impacts on global agriculture, the terms of trade impacts(changing expor prices, relative to import prices) are cut in half. Given the inherent heterogeneity of climate impacts inagriculture, this points to the important role of trade in distributing the associated welfare impacts. When we allow thebiophysical impacts of climate change on crop production to vary across the empirically estimated uncertainty range takenfrom our meta-analysis, we find that the welfare consequences are highly asymmetric, with much larger losses at the low endof the yield distribution. This interaction between the magnitude and heterogeneity of biophysical climate shocks and theirwelfare effects highlight the need for detailed representation of both in projecting climate change impacts.We also have studied the impact of policies aimed at curbing greenhouse gas emissions from conversion of tropical forests topalm oil production in Malaysia and Indonesia. The rapid expansion of oil palm in Malaysia and Indonesia (M&I) hascontributed to record levels of deforestation, carbon emissions, and biodiversity loss. Sustainability certification schemesseeking to address this problem have fallen short of their stated goals, leading to calls for more aggressive measures. Herewe explore 3 alternative conservation policies within a global economic framework and find that marketmediated responsesconfound the efficacy and distributional impacts of these policies. We suggest that simply limiting palm oil production orconsumption is unlikely to halt deforestation in M&I in the absence of active forest conservation incentives. We also find thatM&I would benefit economically by taking domestic action rather than waiting for others to act.

Publications

• Type: Journal Articles Status: Published Year Published: 2019 Citation: Taheripour, F., T.W. Hertel and N. Ramankutty (2019). ÿ¢ÿ¿ÿ¿Market-mediated responses confound policies to limitdeforestation from oil palm expansion in Malaysia and Indonesiaÿ¢ÿ¿ÿ Proceedings of the National Academy of Sciences 116(38) 19193-19199.
• Type: Journal Articles Status: Accepted Year Published: 2019 Citation: Baldos, Uris L.C., Thomas W. Hertel, and Frances Moore, (2019). ÿ¢ÿ¿ÿ¿Understanding the Spatial Distribution of WelfareImpacts of Global Warming on Agriculture and its Driversÿ¢ÿ¿ÿ, American Journal of Agricultural Economics 101(5):1455ÿ¢ÿ¿ÿ¿1472.
• Type: Journal Articles Status: Published Year Published: 2019 Citation: Hertel, Thomas W., Thales West, Jan Boerner and Nelson Villoria, 2019. ÿ¢ÿ¿ÿ¿A Review of Global-Local-Global Linkages inEconomic Land-use/cover Change Modelsÿ¢ÿ¿ÿ Environmental Research Letters 14 053003.

Progress 10/01/17 to 09/30/18

Outputs
Target Audience:The target audiences include national policy makers, international agriculture and envrionment agencies, producer groups, consumers and environmental NGOs, as well as fellow academics in agricultural economics, hydrology, climate science and agronomy. Changes/Problems: Nothing Reported What opportunities for training and professional development has the project provided?We have trained a graduate student as well as a post-doctoral fellow working in the area of long run sustainability of agriculture. How have the results been disseminated to communities of interest?We held an event at the National Press Club in Washington, DC in September, 2018. This involved 70 leaders from the private, public, NGO and academic sectors. It focused on the long run sustainability of US agriculture. Three policy briefs were prepared and presented, along with an interactive web site for exploring results. What do you plan to do during the next reporting period to accomplish the goals?We have several exciting strands of work coming together right now. Our top priority will be to get the policy briefs written up as full length journal articles. We believe they could appear in very high impact journals. We will continue to interact with stakeholders based on the relationships developed at the Press Club event.

Impacts
What was accomplished under these goals? We assessed the need for public investments in research and development (R&D) over the 21st century in light of the very long lag between such investments and US agricultural productivity outcomes and the considerable uncertainty in future populuation, income and bioenergy growth, as well as climate impact uncertainty. R&D has been the major driver of US farm productivity growth since WWII, yet US spending has recently leveled off and has even been declining. Failing to invest today in improvements of agricultural productivity cannot be simply corrected a few decades later if the world finds itself short of food at that point in time. We compute the optimal path of agricultural R&D spending over the 21st century for each SSP, along with valuation of those regrets associated with investment decisions later revealed to be in error. The maximum regret is minimized to find a robust optimal R&D pathway that factors in key uncertainties and the lag in productivity response to R&D. Results indicate that the whole of uncertainty's impact on R&D is greater than the sum of its individual parts. Uncertainty in future population has the dominant impact on the optimal R&D expenditure path. The robust solution suggests that the optimal R&D spending strategy is very close to the one that will increase agricultural productivity fast enough to feed the World under the most populous scenario. It also suggests that society should accelerate R&D spending up to mid-century, thereafter moderating this growth rate.

Publications

• Type: Journal Articles Status: Published Year Published: 2018 Citation: Yao, Guolin, Thomas W. Hertel and Farzad Taheripour, 2018. Economic Drivers of Telecoupling and Terrestrial Carbon Fluxes in the Global Soybean Complex. Global Environmental Change, (50)190-200.
• Type: Journal Articles Status: Published Year Published: 2018 Citation: Hertel, Thomas W. 2018. Economic Perspectives on Land Use Change and Leakage Environmental Research Letters 13 075012
• Type: Journal Articles Status: Published Year Published: 2018 Citation: Baldos, Uris L.C., Frederi G. Viens, Thomas W. Hertel, (2018) R&D Spending, Knowledge Capital and Agricultural Productivity Growth: A Bayesian Approach American Journal of Agricultural Economics aay039 https://doi.org/10.1093/ajae/aay039
• Type: Journal Articles Status: Published Year Published: 2018 Citation: McCarl, Bruce and Thomas W. Hertel, 2018. Climate Change as an Agricultural Economics Research Topic Applied Economics Perspectives and Policy.
• Type: Journal Articles Status: Published Year Published: 2017 Citation: Moore, Frances C., Uris L.C. Baldos, Thomas W. Hertel, and Delavane Diaz, 2017. New Science of Climate Change Impacts on Agriculture Implies Higher Social Cost of Carbon Nature Communications, 18:1607.
• Type: Journal Articles Status: Published Year Published: 2017 Citation: Liu, Jing, Thomas W. Hertel, Richard Lammers, Alexander Prusevich, Uris Baldos, Danielle Grogan and Steve Frolking, 2017. Achieving Sustainable Irrigation Water Withdrawals: Global Impacts on Food Security and Land Use. Environmental Research Letters 12(10) https://doi.org/10.1088/1748-9326/aa88db.
• Type: Journal Articles Status: Published Year Published: 2017 Citation: Cai, Yongyang, Alla A. Golub and Thomas W. Hertel, 2017. Agricultural Spending Must Increase in Light of Future Uncertainties. Food Policy 70:71-83 http://www.sciencedirect.com/science/article/pii/S0306919216303426
• Type: Conference Papers and Presentations Status: Published Year Published: 2018 Citation: Baldos, Uris, and Thomas Hertel. 2018. Productivity Growth Is Key to Achieving Long Run Agricultural Sustainability. Purdue Policy Research Institute, Policy Brief 4 (1). https://docs.lib.purdue.edu/gpripb/ .
• Type: Conference Papers and Presentations Status: Published Year Published: 2018 Citation: Haqiqi, Iman, Laura Bowling, Sadia Jame, Thomas Hertel, Uris Baldos, and Jing Liu. 2018. Global Drivers of Land and Water Sustainability Stresses at Mid-Century. Purdue Policy Research Institute, Policy Brief 4 (1). https://docs.lib.purdue.edu/gpripb/ .
• Type: Conference Papers and Presentations Status: Published Year Published: 2018 Citation: Liu, Jing, Thomas Hertel, Laura Bowling, Sadia Jame, Christopher Kucharik, and Navin Ramankutty. 2018. Evaluating Alternative Options for Managing Nitrogen Losses from Corn Production. Purdue Policy Research Institute, Policy Brief 4 (3). https://docs.lib.purdue.edu/gpripb/ .
• Type: Websites Status: Published Year Published: 2018 Citation: https://mygeohub.org/groups/glass/npc2018

Progress 10/01/16 to 09/30/17

Outputs
Target Audience:This worked has reached scientists, economists, government policy makers, private sector leaders, as well as farm audiences. Changes/Problems: Nothing Reported What opportunities for training and professional development has the project provided?The graduate student in agricultural economics has gotten the chance to work with scientists in other disciplines, including hydrology, agronomy and cliamte science. How have the results been disseminated to communities of interest?Journal articles, presentations to scientists and other professionals, as well as press releases. What do you plan to do during the next reporting period to accomplish the goals?We are pressing ahead with the global gridded modeling and plan to hold an event at the National Press Club focusing on long run sustainability challenges in the US, in September of 2018.

Impacts
What was accomplished under these goals? We made considerable progress on all of these objectives: 1. One of the most important policy levers we have in the global sustainability arena is investment in research and development to improve agricultural productivity. We have explored optimal pathways for agricultural research investments in the context of future uncertainties. This is particularly challenging, given the very long lag between spending and productivity outcomes (up to 50 years, with impacts peaking only after two decades). If the future were known with certainty, this would not be a problem. However, there is great uncerainty about population and economic growth as well as climate impacts. For this reason, robust decision making is required. We show that robust decision rules suggest the need to ramp up research investments sooner, rather than later. We also find significant interaction amongst the different sources of uncerainty. 2. By bringing new science about the agricultural impacts of climate change to bear, we have found that the benefits from climate mitigation are greatly increased. Indeed, using one of the most widely cited integrated assessment models (FUND), we find that our new damage estimates result in a doubling of the social cost of carbon. 3. We have also assessed the potential impacts of future water scarcity, using a global gridded modeling approach. This reveals a varied pattern of unsustainable irrigation for crop production at mid-century, depending on future temperature, precipitation, economic growth and food demands. Efforts to curtail the unsustainable irrigation results in higher food prices, more land conversion and more terrestrial carbon fluxes. So there are tradeoffs in attaining future sustainability goals.

Publications

• Type: Journal Articles Status: Awaiting Publication Year Published: 2017 Citation: McCarl, Bruce and Thomas W. Hertel. Climate Change as an Agricultural Economics Research Topic, Applied Economics Perspectives and Policy, (forthcoming).
• Type: Journal Articles Status: Awaiting Publication Year Published: 2017 Citation: Moore, Frances C., Uris L.C. Baldos, Thomas W. Hertel, and Delavane Diaz, 2017. New Science of Climate Change Impacts on Agriculture Implies Higher Social Cost of Carbon, Nature Communications, (forthcoming).
• Type: Journal Articles Status: Published Year Published: 2017 Citation: Liu, Jing, Thomas W. Hertel, Richard Lammers, Alexander Prusevich, Uris Baldos, Danielle Grogan and Steve Frolking, 2017. Achieving Sustainable Irrigation Water Withdrawals: Global Impacts on Food Security and Land Use, Environmental Research Letters 12(10).
• Type: Journal Articles Status: Published Year Published: 2017 Citation: Corong, Erwin, Thomas W. Hertel, Robert A. McDougall, Marinos E. Tsigas and Dominique van der Mensbrugghe. 2017. The Standard GTAP Model, Version 7, Journal of Global Economic Analysis 2(1): 1-122.
• Type: Journal Articles Status: Published Year Published: 2017 Citation: Moore, Frances C., Uris L.C. Baldos and Thomas W. Hertel, 2017. Economic Impacts of Climate Change on Agriculture: A Comparison of Process-Based and Statistical Yield Models Environmental Research Letters.
• Type: Journal Articles Status: Published Year Published: 2017 Citation: Henderson, B., A. Golub, D. Pambudi, T. Hertel, C. Godde, M. Herrero, O. Cacho, and P. Gerber. 2017. The Power and Pain of Market-Based Carbon Policies: A Global Application to Greenhouse Gases from Ruminant Livestock Production. Mitigation and Adaptation Strategies for Global Change, January, 121.
• Type: Journal Articles Status: Published Year Published: 2017 Citation: Cai, Yongyang, Alla A. Golub and Thomas W. Hertel, 2017. Agricultural Spending Must Increase in Light of Future Uncertainties, Food Policy 70:71-83

Progress 10/01/15 to 09/30/16

Outputs
Target Audience:The target audiences include national policy makers, international agriculture and envrionment agencies, producer groups, consumers and environmental NGOs, as well as fellow academics in agricultural economics, hydrology, climate science and agronomy. Changes/Problems: Nothing Reported What opportunities for training and professional development has the project provided?We published a text book and have used this in an interdisciplinary graduate course where students can develop their own research ideas in the context of this overall project. How have the results been disseminated to communities of interest?In addition to the publications listed above, dissemination has been done through invited lectures, as listed below: Hertel, T.W., based on work with U.L.C. Baldos, Jing Liu, Navin Ramankutty and Yoshi Wada, Estimating the Real Cost of Food, organized session contribution, Global Land Project meetings, Beijing, China, October 25, 2016. Hertel, T.W., based on work with Guolin Yao and Farzad Taheripour, Economic Insights into Telecoupling, symposium presentation, Global Land Project meetings, Beijing, China, October 25, 2016. Hertel, T.W., based on work with U.L.C. Baldos, Food and Environmental Security in an Era of Globalization, seminar presented at Renmin University, Beijing, China, October 24, 2016. Hertel, T.W., based on work with U.L.C. Baldos, Food and Environmental Security in an Era of Globalization, seminar presented at the IRI-THYS Center, Humboldt University, Berlin, March 17, 2016. Hertel, T.W., Climate Change, Agricultural Trade and Food Security, Presentation at the annual meetings of the American Association for the Advancement of Science, Washington, D.C., February 14, 2016. Hertel, T.W. in collaboration with Farzad Taheripour and Badri Narayanan, Food Security, Irrigation, Climate Change and Water Scarcity in India, invited presentation at the American Geophysical Union meetings, San Francisco, CA, December 14, 2015. Hertel, T.W. in collaboration with Uris Baldos and Jing Liu, Exploring the Food-Land-Water Nexus with SIMPLE-on-a-global-grid, presentation to the PIAMDDI meetings, Stanford University, December 15, 2015. Hertel, T.W., Global Land use Modeling for the Food-Energy-Water Nexus, presentation to the NSF workshop on Food Energy and Water Systems, Iowa State University, October 12, 2015. What do you plan to do during the next reporting period to accomplish the goals?I plan to continue the current thrust into global, gridded modeling of agriculture and sustainability. This will offer important new insights into the potential for achieving the United Nations' Sustainable Development Goals.

Impacts
What was accomplished under these goals? The following accomplishments are organized by goal: 1. We have provided a comprehensive analysis of the long run growth prospects for agriculture, both by region, and globally. We find that there is a 66% probability that crop prices in 2050 will be lower than 2006. This is primarily due to the slowdown in global population growth and near elimination of growth in the richest economies, where per capita consumption is highest. Overall, crop production is likely to rise by about 90% between 2006 and 2050, but net land conversion globally will be modest due to productivity gains. This will limit the emission of carbon into the atmosphere. In the presence of aggressive, terrestrial climate mitigation policies, crop production and land conversion would be even lower. 2. Future uncertainty in economic growth, as well climate impacts and climate policy will have an important impact on, investments in R&D, technological progress, as well as land use change. We find that, when one factors in these uncertainties, it is optimal to invest more in R&D today, as a form of insurance against the worst case scenarios. 3. We have examined the impact of future water scarcity on global crop prices, land use, trade and GHG emissions. Water scarcity in the future is likely to be highly localized, with severe stress in areas of high economic growth, arid conditions and low groundwater recharge rates. Water stress is likely to lead to increased food imports from food abundant regions. In this sense, trade represents an important adaptation measure in the face of water scarcity. Indeed, international trade is likely to limit the impact of future water scarcity on global crop prices. However, by limiting future irrigation in some of the regions with highest current yields, water scarcity is likely to increase total land conversion as well as carbon emissions. 4. In 2050 we project that most of the world's insecure population will reside in South Asia and Africa. Unless these regions can boost agricultural productivity, they are likely to need massive food imports in the future. This is accentuated by adverse climate impacts in these regions. For this reason, it will important to do everything possible to facilitte international trade in food products. International trade will become more valuable in the future under climate change.

Publications

• Type: Journal Articles Status: Published Year Published: 2015 Citation: Hertel, T., W., J. Steinbuks and W.E. Tyner, (2015) What Is the Social Value of Second Generation Biofuels?, Applied Economic Perspectives and Policy.
• Type: Journal Articles Status: Published Year Published: 2016 Citation: Hertel, T., W. (2016) Food Security Under Climate Change, Nature Climate Change(6):10-13.
• Type: Journal Articles Status: Published Year Published: 2016 Citation: Peters, J. C. and T. W. Hertel. (2016) Matrix Balancing with Unknown Total Costs: Preserving Economic Relationships in the Electric Power Sector, Economic Systems Research http://www.tandfonline.com/doi/full/10.1080/09535314.2015.1124068
• Type: Journal Articles Status: Published Year Published: 2016 Citation: Peters, J. C. and T. W. Hertel. (2016) The Database-Modeling Nexus in Integrated Assessment Modeling of Electric Power Generation, Energy Economics 56:107-116.
• Type: Other Status: Published Year Published: 2016 Citation: Hertel, T., W., J. Liu (2016) Implications of Water Scarcity for Economic Growth, OECD Environment Working Paper No. 109: http://www.oecd-ilibrary.org/environment/implications-of-water-scarcity-for-economic-growth_5jlssl611r32-en
• Type: Journal Articles Status: Published Year Published: 2016 Citation: Liu, J., T.W. Hertel, and F. Taheripour (2016). Analyzing Water Scarcity in Global CGE Models, Water Economics and Policy, doi: 10.1142/S2382624X16500065.
• Type: Journal Articles Status: Published Year Published: 2016 Citation: Hertel, T., W., U.L.C. Baldos and D. van der Mensbrugghe (2016) Predicting Long Term Food Demand, Cropland Use and Prices, Annual Review of Resource Economics 8:417-441 doi:10.1146/annurev-resource-100815-095333.
• Type: Journal Articles Status: Published Year Published: 2016 Citation: Baldos, U.L.C. and T.W. Hertel, (2016) Debunking the New Normal: Why World Food Prices are Expected to Resume their Long run Downward Trend, Global Food Security, (8):27-38.
• Type: Journal Articles Status: Published Year Published: 2016 Citation: Akgul, Z., N.B. Villoria and T.W. Hertel, (2016) GTAP-HET: Introducing Firm Heterogeneity into the GTAP Model, Journal of Global Economic Analysis, (1):111-180.
• Type: Journal Articles Status: Published Year Published: 2016 Citation: Hertel, T.W. and U.L.C. Baldos. (2016) Attaining Food and Environmental Security in an Era of Globalization, Global Environmental Change, 41:195-205.
• Type: Books Status: Published Year Published: 2016 Citation: Hertel, Thomas W. and U.L.C. Baldos, 2016. Global Change and the Challenge of Sustainably Feeding a Growing Planet, New York: Springer.

Progress 10/01/14 to 09/30/15

Outputs
Target Audience:Decision makers at the national and international levels, including government and private sector leaders Fellow academics, including those from disciplines outside economics Changes/Problems: Nothing Reported What opportunities for training and professional development has the project provided?We have just completed a textbook on global sustainability and we use this material in an inter-disciplinary course for gradute students at Purdue University. I have trained a post-doctoral fellow who will now be going on the job market and hopes to take a position in this field at a major research university. How have the results been disseminated to communities of interest?The PNAS paper was picked up by a blog and a Purdue news release garnered significant media attention. What do you plan to do during the next reporting period to accomplish the goals?Continue working hard!

Impacts
What was accomplished under these goals? 1. We have now decomposed the drivers of global crop output, land use and prices from 2006-2050 as well as characterizing the full distribution of possile outcomes at mid-century. This work suggests that prices are most likely to resume their long run downward trend, despite the recent high prices. 2. Climate impacts on agriculture remain highly uncertain -- both due to climate model uncertainty as well as crop model uncertainty and data uncertainty. However, we have shown that more integrated global commodity markets can play an important role in dampening the adverse impacts on global food insecurity if climate impacts are at the most severe end of the spectrum. 3. We have examined the impact of global water scarcity in 2030 on agricultural land use, production, consumption and trade. We find that, while local impacts are likley to be quite severe, these can be significantly moderated through international trade. As a result, we do not expect a large impact of such localized water scarcity on global food prices.

Publications

• Type: Journal Articles Status: Published Year Published: 2015 Citation: Hertel, T., W., J. Steinbuks and W.E. Tyner, (2015) What Is the Social Value of Second Generation Biofuels?, Applied Economic Perspectives and Policy, doi: 10.1093/aepp/ppv027.
• Type: Journal Articles Status: Published Year Published: 2015 Citation: Liu, J., T.W. Hertel, N.S. Diffenbaugh, M.S. Delgado and M. Ashfaq (2015). Future property damage from flooding: Sensitivities to Economy and Climate Change, Climatic Change August, DOI 10.1007/s10584-015-1478-z
• Type: Journal Articles Status: Published Year Published: 2015 Citation: Hertel, T., W. (2015) The Challenges of Sustainably Feeding a Growing Planet, Food Security http://link.springer.com/article/10.1007%2Fs12571-015-0440-2
• Type: Journal Articles Status: Published Year Published: 2015 Citation: U.L.C. Baldos and T. W. Hertel (2015) The Role of International Trade in Managing Food Security Risks from Climate Change, Food Security http://link.springer.com/article/10.1007/s12571-015-0435-z#page-1
• Type: Journal Articles Status: Published Year Published: 2014 Citation: Liu, Jianguo, Harold Mooney, Vanessa Hull, Steven J. Davis, Joanne Gaskell, Thomas Hertel, Jane Lubchenco, et al. 2015. Systems Integration for Global Sustainability. Science 347 (6225): 1258832. doi:10.1126/science.1258832.
• Type: Journal Articles Status: Published Year Published: 2014 Citation: Steinbuks, J. and T. W. Hertel (2014) Confronting the Food-Energy-Environment Trilemma: Global Land Use in the Long Run, Environmental and Resource Economics http://link.springer.com/article/10.1007%2Fs10640-014-9848-y#page-1
• Type: Journal Articles Status: Published Year Published: 2014 Citation: Hertel, T., W., N. Ramankutty and U.L.C. Baldos, (2014) Global market integration increases likelihood that a future African Green Revolution could increase crop land use and CO2 emissions, Proceedings of the National Academy of Sciences 111(38): 1379913804, doi: 10.1073/pnas.1403543111.
• Type: Book Chapters Status: Published Year Published: 2014 Citation: Walmsley, T.L., T.W. Hertel and D. Hummels (2014). Developing a GTAP-Based, Multi-Region, Input-Output Framework for Supply Chain Analysis, Chapter 2 in Asia and Global Production Networks: Implications for Trade, Incomes and Vulnerability, edited by Benno Ferrarini and David Hummels, Cheltenham: Edward Elgar Press.
• Type: Book Chapters Status: Published Year Published: 2014 Citation: Hertel, T.W., D. Hummels and T.L. Walmsley (2014). The Vulnerability of Asian Supply Chains to Localized Disasters, Chapter 3 in Asia and Global Production Networks: Implications for Trade, Incomes and Vulnerability, edited by Benno Ferrarini and David Hummels, Cheltenham: Edward Elgar Press.