Cost-effectiveness of greenhouse gases mitigation measures in the European agro-forestry sector: a literature survey

Over the last 20 years, climate change has become an increasing concern for scientists, public opinions and policy makers. Due to the pervasive nature of its impacts for many important aspects of human life, climate change is likely to influence and be influenced by the most diverse policy or management choices. This is particularly true for those interventions affecting agriculture and forestry: they are strongly dependent on climate phenomena, but also contribute to climate evolution being sources of and sinks for greenhouse gases (GHG). This paper offers a survey of the existing literature assessing cost-effectiveness and efficiency of greenhouse gas mitigation strategies or the effects of broader economic reforms in the agricultural and forestry sectors. The focus is mainly on European countries. Different methodological approaches, research questions addressed and results are examined. The main findings are that agriculture can potentially provide emissions reduction at a competitive cost, mainly with methane abatement, while carbon sequestration seems more cost-effective with appropriate forest management measures. Afforestation, cropland management and bioenergy are less economically viable measures due to competition with other land use. Mitigation policies should be carefully designed either to balance costs with expected benefits in terms of social welfare. Regional variability is one of the main drawbacks to fully assess the cost-effectiveness of different measures. Integration of models to take into account both social welfare and spatial heterogeneity seems to be the frontier of the next model generation. (C) 2007 Elsevier Ltd. All rights reserved.