

Tradeoff Analysis: Online course Kenya Section 5  Model estimation


In this
previous section we described the basic economic and environmental data to
run the Tradeoff Analysis System. With the available data we are now going to
estimate the econometric simulation model. A key factor influencing
management decisions is the inherent productivity of the land unit. The model
estimation phase comprises therefore two steps:





Calculation of the inherent productivities 

The inherent productivities are calculated using crop growth simulation models from the DSSAT suite of models. In the case of Machakos we identified 5 different systems: intercropping with maize, vegetables and legumes; monocropped maize, vegetables, pasture grass, and maize intercropped with beans. In addition there are two livestock products, milk and manure. For several of these individual crops we do not have crop growth simulation models available that can estimate the inherent productivities. In the current setup we will calculate the inherent productivities for maize and beans only. Likewise for livestock, biophysical simulation models could be used to calculate inherent productivity (e.g., based on dairy production) but are not available in this example. 



Exercise 6: Inherent productivity calculation 





Run the econometric models 

With the available data on the inherent
productivities we can now estimate the econometric production models for the
different crops and estimate the parameters of the price and exogenous
variable distributions. 



Exercise 7: Econometric model estimation 


