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Land degradation is occurring in almost all terrestrial biomes and agro-ecologies, in both low and high income countries. However its impact is especially severe on the livelihoods of the poor who heavily depend on natural resources. Despite the severe impact of land degradation on the poor and the crucial role that land plays in human welfare and development, investments in sustainable land management (SLM) are low, especially in developing countries. This chapter summarizes the results from global and regional levels as well as 12 case study countries. The chapter also draws conclusions and implications for taking action against land degradation. Land degradation stretches to about 30 % of the total global land area and about three billion people reside in degraded lands. The annual global cost of land degradation due to land use/cover change (LUCC) and using land degrading management practices on static cropland and grazing land is about 300 billion USD. Sub-Saharan Africa (SSA) accounts for the largest share (22 %) of the total global cost of land degradation. Only about 46 % of the cost of land degradation due to LUCC—which accounts for 78 % of the US$300 billion loss—is borne by land users and the remaining share (54 %) is borne by consumers of ecosystem services off the farm. This further illustrates that land degradation is a global problem even though its impact is much greater on poor land users. The cost of taking action against land degradation is much lower than the cost of inaction and the returns to taking action are high. On average, one US dollar investment into restoration of degraded land returns five US dollars. This provides a strong incentive for taking action against land degradation. This study shows that simultaneously enhancing local and national level governments, land tenure security, and improving market access is the most effective strategy for addressing land degradation. Given that LUCC accounts for the largest share of cost of land degradation, here is a need for developing land use planning that will ensure that forests and other high value biomes are effectively protected. Empirical evidence has shown that involvement of local communities in managing forests and other high value biomes and creating mechanisms for them to directly benefit from their conservation efforts lead to more effective protection than is the case with centralized protection. The assessment in this volume is being conducted at a time when there is an elevated interest in private land investments and when global efforts to achieve sustainable development objectives have intensified. This means, results of this volume will contribute significantly to the ongoing policy debate and efforts to design strategies for achieving sustainable development goals and other efforts to address land degradation and halt biodiversity loss.

The Economics of Land Degradation (ELD) initiative seeks to develop a science basis for policy actions to address land degradation. The purpose of this chapter is to provide with a conceptual framework and sound and feasible methodological standards for ELD assessments at global and national levels. Only if some basic standards are identified and adhered to, comparative assessments can be conducted between countries and useful aggregation of findings, based on these case studies, can be achieved. Therefore, using the Total Economic Value (TEV) framework, the chapter identifies minimum core standards that need to be adhered to in all country case studies to generate comparable material for international assessment and ELD policy guidance.

While econometric and spatial data are increasingly helpful to quantify and locate the extent and costs of land degradation, there is still little understanding of the contextual factors that determine or influence the land users’ practices that aggravate or counteract land degradation. In this chapter, we take an institutional economic approach to analyse the persistence of degrading practices, the low adoption of sustainable land management (SLM), or the eventual organisational reaction to land degradation. The chapter reviews four examples of land degradation in different contexts to reveal the multiple driving forces and contextual factors. We then propose a conceptual framework to better understand the incentive structure and factors determining the land users’ decision making. A layered analysis of the social phenomena is applied, following Williamson (). The chapter shows how actions at different layers can help improve land management. The chapter concludes with practical recommendations for the institutional economic analysis of land degradation.

Land degradation affects negatively the livelihoods and food security of global population. There have been recurring efforts by the international community to identify the global extent and severity of land degradation. Using the long-term trend of biomass productivity as a proxy of land degradation at global scale, we identify the degradation hotspots in the world across major land cover types. We correct factors confounding the relationship between the remotely sensed vegetation index and land-based biomass productivity, including the effects of inter-annual rainfall variation, atmospheric fertilization and intensive use of chemical fertilizers. Our findings show that land degradation hotpots cover about 29 % of global land area and are happening in all agro-ecologies and land cover types. This figure does not include all areas of degraded lands, it refers to areas where land degradation is most acute and requires priority actions in both in-depth research and management measures to combat land degradation. About 3.2 billion people reside in these degrading areas. However, the number of people affected by land degradation is likely to be higher as more people depend on the continuous flow of ecosystem goods and services from these affected areas. Land improvement has occurred in about 2.7 % of global land area during the last three decades, suggesting that with appropriate actions land degradation trend could be reversed. We also identify concrete aspects in which these results should be interpreted with cautions, the limitations of this work and the key areas for future research.

Understanding the impacts of land degradation is, at least in part, limited by our ability to accurately characterize those impacts in space and time. While in recent decades remote sensing has offered unprecedented coverage of the land surface, the evaluation of remote sensing products is often limited or lacking altogether. In this chapter we use a survey-based approach to evaluate how well already existing remotely sensed datasets depict areas of land degradation. Ground-based surveys are compared to existing maps of land degradation and independent remote sensing datasets. This provides a metric of evaluation by using the commonly understood confusion-matrix. A representative set of case study countries was chosen after all countries were grouped using a k-means clustering approach (see Chap. ). Survey sites within each country were sampled according to the intersection of agro-ecological zones, land cover, and the dataset to be evaluated. This two-tiered approach to sampling ensured a diversity of ground-truth surveys and therefore a robustness of results. Although ground-based surveys are resource and time-intensive, they provide information on both the evolution of the land cover and the drivers of land-cover change. Land degradation is a very complex process where diverse data are often needed for interpretation.

Land degradation—defined by the Millennium Ecosystem Assessment report as the long-term loss of ecosystems services—is a global problem, negatively affecting the livelihoods and food security of billions of people. Intensifying efforts, mobilizing more investments and strengthening the policy commitment for addressing land degradation at the global level needs to be supported by a careful evaluation of the costs and benefits of action versus costs of inaction against land degradation. Consistent with the definition of land degradation, we adopt the Total Economic Value (TEV) approach to determine the costs of land degradation and use remote sensing data and global statistical databases in our analysis. The results show that the annual costs of land degradation due to land use and land cover change (LUCC) are about US$231 billion per year or about 0.41 % of the global GDP of US$56.49 trillion in 2007. Contrary to past global land degradation assessment studies, land degradation is severe in both tropical and temperate countries. However, the losses from LUCC are especially high in Sub-Saharan Africa, which accounts for 26 % of the total global costs of land degradation due to LUCC. However, the local tangible losses (mainly provisioning services) account only for 46 % of the total cost of land degradation and the rest of the cost is due to the losses of ecosystem services (ES) accruable largely to beneficiaries other than the local land users. These external ES losses include carbon sequestration, biodiversity, genetic information and cultural services. This implies that the global community bears the largest cost of land degradation, which suggests that efforts to address land degradation should be done bearing in mind that the global community, as a whole, incurs larger losses than the local communities experiencing land degradation. The cost of soil fertility mining due to using land degrading management practices on maize, rice and wheat is estimated to be about US$15 billion per year or 0.07 % of the global GDP. Though these results are based on a crop simulation approach that underestimates the impact of land degradation and covers only three crops, they reveal the high cost of land degradation for the production of the major food crops of the world. Our simulations also show that returns to investment in action against land degradation are twice larger than the cost of inaction in the first six years alone. Moreover, when one takes a 30-year planning horizon, the returns are five dollars per each dollar invested in action against land degradation. The opportunity cost accounts for the largest share of the cost of action against land degradation. This explains why land users, often basing their decisions in very short-time horizons, could degrade their lands even when they are aware of bigger longer-term losses that are incurred in the process.

Identification of factors catalyzing sustainable land management (SLM) could provide insights for national policies and international efforts to address land degradation. Building on previous studies, and using novel datasets, this chapter identifies major drivers of land degradation at global and regional levels. The findings of this study confirm the earlier insights in the literature on the context-specific nature of the drivers of land degradation. This context-dependence explains the previous contradictions in the literature on the effects of various socio-economic and institutional factors on land degradation. It also calls for the localized diagnostic of the drivers of land degradation. The drivers of land degradation are predominantly local, so actions to address them should be based on the understanding of the local interplay of various factors and how they affect land degradation.

In response to the needs for estimating the cost of grassland degradation to determine the cost of inaction and for identifying cost-effective strategies to address the consequent loss of livestock productivity, we developed a modeling framework where global statistics databases and remote sensing data/analyses coupled with empirical/statistical modeling are designed to quantify the global cost of grassland degradation. By using this framework, we identified grassland degradation hotspots over the period of 2001 to 2011 and estimated changes in livestock productivity associated with changes in grassland productivity within the hotspots. Ignoring environmental benefits and losses in live weight of livestock not slaughtered or sold, the cost of livestock productivity was estimated about 2007 US$6.8 billion. Although on-farm cost is small in Sub-Saharan Africa due to the low livestock productivity, the impact on human welfare would be much more severe in the region where majority of the population is below the poverty line. This implies that addressing grassland degradation is even more urgent in the region, given the increasing demand for livestock products and the potential contribution to poverty reduction. Taking action toward grassland degradation could simultaneously reduce poverty and promote carbon sequestration while conserving socio-economic, cultural, and ecological benefits that livestock provide.

Sub-Saharan Africa (SSA) has experienced the most severe land degradation in the world. Given that livelihoods of the majority of the rural poor heavily depend on natural resources, countries in the region have designed a number of policies and strategies to address land degradation and to enhance productivity. However investment from both countries and their development partners has remained low, especially for livestock, which accounts for the largest area degraded. Our results show that conversion of grassland to cropland and deforestation are the major factors driving land use/cover change (LUCC). One of the major reasons leading farmers to convert grassland to cropland is the low livestock productivity. The increasing demand for livestock products provides an ample opportunity to the value of grasslands and in turn livestock productivity. Given that donor funding accounts for the largest share of expenditure on agriculture and natural resource management in most SSA countries, econometric analysis showed that donor funding reduces the cost of land degradation. This positions donors in a position of influencing efforts to combat land degradation in SSA. The fact that SSA has poor marketing infrastructure suggests that its improvement will enhance efforts to address low productivity and land degradation. Econometric analysis showed that access to market leads to a reduction of the cost of land degradation related to LUCC. Improvement of market infrastructure will achieve a win-win benefit as it will improve natural resources and reduce poverty. Consistent with results from other regions, improvement of government effectiveness reduces cost of land degradation and cropland expansion. This illustrates the key role played by governance in mediating the drivers of land degradation. Efforts to increase adoption of integrated soil fertility management will require improvement of access to markets, advisory services and retraining of agricultural extension services. There is also need to find practical and amenable strategies for incentivizing farmers to use ISFM. For example, conditional fertilizer subsidy could provide incentives for farmers to adopt nitrogen fixing agroforestry trees and improve significantly the current subsidy programs in several SSA countries. Overall, our results show that SSA has the potential to become the breadbasket of the world but it has to significantly improve its market access and government effectiveness to create incentives for land holders to invest in land improvement. The increasing demand for land, urbanization, and other global regional changes are creating a conducive condition for taking action against land degradation. These opportunities should be exploited effectively as they lead to win-win outcomes—reducing poverty and achieving sustainable land management.

Land degradation is a major development challenge in Central Asia, with negative implications on rural livelihoods and food security. We estimate the annual cost of land degradation in the region due to land use and cover change between 2001 and 2009 to be about 6 billion USD, most of which due to rangeland degradation (4.6 billion USD), followed by desertification (0.8 billion USD), deforestation (0.3 billion USD) and abandonment of croplands (0.1 billion USD). The costs of action against land degradation are found to be lower than the costs of inaction in Central Asia by 5 times over a 30-year horizon, meaning that each dollar spent on addressing land degradation is likely to have about 5 dollars of returns. This is a very strong economic justification favoring action versus inaction against land degradation. Specifically, the costs of action were found to equal about 53 billion USD over a 30-year horizon, whereas if nothing is done, the resulting losses may equal almost 288 billion USD during the same period. Better access to markets, extension services, secure land tenure, and livestock ownership among smallholder crop producers are found to be major drivers of SLM adoptions.