Structural adjustment and soil degradation in Tanzania A CGE model approach with endogenous soil productivity

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 input levels -and hence production volumes -which in turn influence soil productivity in 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 like a reduction in agro-chemicals' subsidies, reduced implicit export tax rate etc. After 10 years, the result of a joint implementation is a 9% higher Gross Domestic Product (GDP) level compared to the baseline scenario. The effect of soil degradation is found to represent a reduction in the GDP level of more than 5% for the same time period.

Small Farmers' Adaptive Efforts to Rainfall Variability and Soil Erosion Problem in Semiarid Tanzania

“…Narrowing our understanding to Tanzania's past socio-economic trends and particularly, increase in population density, villagization program, and the recent global economic and technical changes, farmers' adaptive strategies such as high stocking rates (resulting in overgrazing), excess cropping, shifting agriculture and so on have been linked variably with land degradation and soil erosion problems (see Christiansson and Kilula, 1996;Shishira and Pyton, 1996;Aune, 1995;Kaihura, 1991;Wiig et al, 2001). Therefore farmers are currently faced not only by stochastic rainfall pattern but also accelerated soil erosion problem.…”