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| Titel |
Assessing the economic impacts of drought from the perspective of profit loss rate: a case study of the sugar industry in China |
| VerfasserIn |
Y. Wang, L. Lin, H. Chen |
| Medientyp |
Artikel
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| Sprache |
Englisch
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| ISSN |
1561-8633
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| Digitales Dokument |
URL |
| Erschienen |
In: Natural Hazards and Earth System Sciences ; 15, no. 7 ; Nr. 15, no. 7 (2015-07-23), S.1603-1616 |
| Datensatznummer |
250119603
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| Publikation (Nr.) |
 copernicus.org/nhess-15-1603-2015.pdf |
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| Zusammenfassung |
| Natural disasters have enormous impacts on human society, especially on the
development of the economy. To support decision-making in mitigation and
adaption to natural disasters, assessment of economic impacts is fundamental
and of great significance. Based on a review of the literature on economic
impact evaluation, this paper proposes a new assessment model of the economic
impacts of droughts by using the sugar industry in China as a case study,
which focuses on the generation and transfer of economic impacts along a
simple value chain involving only sugarcane growers and a sugar-producing
company. A perspective of profit loss rate is applied to scale economic
impact. By using "with and without" analysis, profit loss is defined as
the difference in profits between disaster-hit and disaster-free scenarios.
To calculate profit, analysis of a time series of sugar price is applied.
With the support of a linear regression model, an endogenous trend in sugar
price is identified and the time series of sugar price "without" disaster
is obtained, using an autoregressive error model to separate impact of
disasters from the internal trend in sugar price. Unlike the settings in
other assessment models, representative sugar prices, which represent value
level in disaster-free conditions and disaster-hit conditions, are integrated
from a long time series that covers the whole period of drought. As a
result, it is found that in a rigid farming contract, sugarcane growers
suffer far more than the sugar company when impacted by severe drought, which
may promote reflections among various economic
bodies on economic equality related to the occurrence of natural disasters. Further, sensitivity analysis
of the model built reveals that sugarcane purchase price has a significant
influence on profit loss rate, which implies that setting a proper sugarcane
purchase price would be an effective way of realizing economic equality in
future practice of contract farming. |
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