Modelling Water efficiency

Water demand

Water stress

Agriculture labour

Sustainable management

Agriculture capital

Forest land

Organic fertiliser

Chemical fertiliser

Soil quality

Fertiliser use

Natural crop yield per ha

Pre harvest losses

Effective crop yield per ha

R&D

Harvested area

Oil price

GDP

Agriculture production

Population

Figure 16: Causal loop diagram (CLD) representing the main factors influencing crop yield in the agriculture sector of the model (blue boxes). Orange boxes represent the green investment options analysed

The effective crop yield is defined as the difference between natural yield and losses due to plant diseases. The natural crop yield instead is influenced by capital and labour, as well as by R&D (e.g. seed improvements), soil quality, the use of fertilisers and water availability. Soil quality is further influenced by the use of fertilisers and by forestland.

forest ecosystems in 2050, which is 71Gt above BAU and 21Gt higher than the current level. Furthermore, a greater extent of forested land improves soil quality and often increases water availability, two factors that impact agriculture production positively (Pretty et al. 2006). In the short-term, however, the efforts of reforestation (2.5 and 3 times that of BAU) and avoided deforestation (60 per cent and 46 per cent above BAU) as a result of green

investment do not bring immediate benefits to the environment, given the time it takes to increase the area of planted forests. The total forest area (around 4 billion hectares) is projected to be 1 per cent and 3 per cent higher than BAU in 2015 and 2020. Forestry production will start seeing benefits around 2020, reaching US$ 840 billion of value added in 2020, which is 12.5 per cent higher than baseline, creating around 3 million additional jobs.

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