Agroforestry systems for sustainable livelihoods and improved land management in the East Usambara Mountains, Tanzania

Forest destruction for agriculture continues to be a major threat to the rich biological diversity in the East Usambara Mountains in the north-eastern corner of Tanzania. The highest ratio of endemic plant and animal species found on 100 km2 anywhere in the world is depending on the remaining natural forests. Forests are vitally important for the local population in many different ways, and nationally they are an important source of water and hydroelectricity. The soils, of low fertility and mostly acidic Ferrasols, mainly have the nutrients in the topsoil. After clear-cutting, the soils soon become poor when the topsoil is eroded. High-value cardamom is nowadays unsustainably cultivated in the natural forests of the East Usambaras. The general aim was to study the possibilities to develop new profitable and sustainable agroforestry systems for the benefit of the local people that could contribute to relieving the pressure on the remaining natural forests in the East Usambara Mountains. Results from a spice crop agroforestry trial, established in cooperation with a local farmer, showed a clear advantage of intercropping cardamom (Elettaria cardamomum) and black pepper (Piper nigrum) with trees, especially with Grevillea robusta. The nitrogen fixing tree species Gliricidia sepium also improved the nitrogen and organic matter content of the soil over levels found in the natural forest. With improved agroforestry methods for spice production the households generated as much as13 times the net income obtained with traditional forest cultivation practices. There are thus sustainable and profitable ways to cultivate spices as cash crops in well-managed homegardens. However, the farmers need stable markets, access to credit and comprehensive extension services. The soil fertility depletion should be reversed with organic manure application and an enabling policy environment for the smallholder-farming sector. Strong farmers organisations and equal rights to resources and decision-making are needed. Organic spices have an increasing demand, and their export would be profitable for these farmers. What is, however, most needed for a change is a political will of a government that understands the importance of agricultural and forestry development for poverty reduction.

Essays on Economic Integration and Labour Demand

This dissertation consists of an introductory section and three essays investigating the effects of economic integration on labour demand by using theoretical models and by empirical analysis. The essays adopt an intra-industry trade approach to specify a theoretical framework of estimation for determining the effects of economic integration on employment. In all the essays the empirical aim is to explore the labour demand consequences of European integration. The first essay analyzes how labour-demand elasticities with own price have changed during the process of economic integration. As a theoretical result, intensified trade competition increases labour-demand elasticity, whereas better advantage of economies of scale decreases labour-demand elasticity by decreasing the elasticity of substitution between differentiated products. Furthermore, if integration gives rise to an increase in input-substitutability and/or outsourcing activities, labour demand will become more elastic. Using data from the manufacturing sector from 1975 to 2002, the empirical results provide support for the hypothesis that European integration has contributed to increased elasticities of total labour demand in Finland. The second essay analyzes how economic integration affects the impact of welfare poli-cies on employment. The essay considers the viability of financing the public sector, i.e. public consumption and social security expenses, by general labour taxation in an economy which has become more integrated into international product markets. The theoretical results of the second essay indicate that, as increased trade competition crowds out better economies of scale, it becomes more costly to maintain welfare systems financed by labour taxation. Using data from European countries for the years 1975 to 2004, the empirical results provide inconsistent evidence for the hypothesis that economic integration has contributed to the distortion effects of welfare policies on employment. The third essay analyzes the impact of profit sharing on employment as a way to introduce wage flexibility into the process of economic integration. The results of the essay suggest that, in theory, the effects of economic integration on the impact of profit sharing on employment clearly depend on a trade-off between intensified competition and better advantage of economies of scale. If product market competition increases, the ability of profit sharing to improve employment through economic integration increases with moderated wages. While, the economic integration associating with market power in turn decrease the possibilities of profit sharing with higher wages to improve employment. Using data from the manufacturing sector for the years 1996 to 2004, the empirical results show that profit-sharing has a positive impact on employment during the process of European integration, but can have ambiguous effects on the stability of employment in Finland.

From environmental concerns towards sustainable food provisioning. : Material flow and food consumption scenario studies on sustainability of agri-food systems

Agriculture is an economic activity that heavily relies on the availability of natural resources. Through its role in food production agriculture is a major factor affecting public welfare and health, and its indirect contribution to gross domestic product and employment is significant. Agriculture also contributes to numerous ecosystem services through management of rural areas. However, the environmental impact of agriculture is considerable and reaches far beyond the agroecosystems. The questions related to farming for food production are, thus, manifold and of great public concern. Improving environmental performance of agriculture and sustainability of food production, sustainabilizing food production, calls for application of wide range of expertise knowledge. This study falls within the field of agro-ecology, with interphases to food systems and sustainability research and exploits the methods typical of industrial ecology. The research in these fields extends from multidisciplinary to interdisciplinary and transdisciplinary, a holistic approach being the key tenet. The methods of industrial ecology have been applied extensively to explore the interaction between human economic activity and resource use. Specifically, the material flow approach (MFA) has established its position through application of systematic environmental and economic accounting statistics. However, very few studies have applied MFA specifically to agriculture. The MFA approach was used in this thesis in such a context in Finland. The focus of this study is the ecological sustainability of primary production. The aim was to explore the possibilities of assessing ecological sustainability of agriculture by using two different approaches. In the first approach the MFA-methods from industrial ecology were applied to agriculture, whereas the other is based on the food consumption scenarios. The two approaches were used in order to capture some of the impacts of dietary changes and of changes in production mode on the environment. The methods were applied at levels ranging from national to sector and local levels. Through the supply-demand approach, the viewpoint changed between that of food production to that of food consumption. The main data sources were official statistics complemented with published research results and expertise appraisals. MFA approach was used to define the system boundaries, to quantify the material flows and to construct eco-efficiency indicators for agriculture. The results were further elaborated for an input-output model that was used to analyse the food flux in Finland and to determine its relationship to the economy-wide physical and monetary flows. The methods based on food consumption scenarios were applied at regional and local level for assessing feasibility and environmental impacts of relocalising food production. The approach was also used for quantification and source allocation of greenhouse gas (GHG) emissions of primary production. GHG assessment provided, thus, a means of crosschecking the results obtained by using the two different approaches. MFA data as such or expressed as eco-efficiency indicators, are useful in describing the overall development. However, the data are not sufficiently detailed for identifying the hot spots of environmental sustainability. Eco-efficiency indicators should not be bluntly used in environmental assessment: the carrying capacity of the nature, the potential exhaustion of non-renewable natural resources and the possible rebound effect need also to be accounted for when striving towards improved eco-efficiency. The input-output model is suitable for nationwide economy analyses and it shows the distribution of monetary and material flows among the various sectors. Environmental impact can be captured only at a very general level in terms of total material requirement, gaseous emissions, energy consumption and agricultural land use. Improving environmental performance of food production requires more detailed and more local information. The approach based on food consumption scenarios can be applied at regional or local scales. Based on various diet options the method accounts for the feasibility of re-localising food production and environmental impacts of such re-localisation in terms of nutrient balances, gaseous emissions, agricultural energy consumption, agricultural land use and diversity of crop cultivation. The approach is applicable anywhere, but the calculation parameters need to be adjusted so as to comply with the specific circumstances. The food consumption scenario approach, thus, pays attention to the variability of production circumstances, and may provide some environmental information that is locally relevant. The approaches based on the input-output model and on food consumption scenarios represent small steps towards more holistic systemic thinking. However, neither one alone nor the two together provide sufficient information for sustainabilizing food production. Environmental performance of food production should be assessed together with the other criteria of sustainable food provisioning. This requires evaluation and integration of research results from many different disciplines in the context of a specified geographic area. Foodshed area that comprises both the rural hinterlands of food production and the population centres of food consumption is suggested to represent a suitable areal extent for such research. Finding a balance between the various aspects of sustainability is a matter of optimal trade-off. The balance cannot be universally determined, but the assessment methods and the actual measures depend on what the bottlenecks of sustainability are in the area concerned. These have to be agreed upon among the actors of the area

Inventory Routing - A Strategic Management Accounting Perspective

This dissertation develops a strategic management accounting perspective of inventory routing. The thesis studies the drivers of cost efficiency gains by identifying the role of the underlying cost structure, demand, information sharing, forecasting accuracy, service levels, vehicle fleet, planning horizon and other strategic factors as well as the interaction effects among these factors with respect to performance outcomes. The task is to enhance the knowledge of the strategic situations that favor the implementation of inventory routing systems, understanding cause-and-effect relationships, linkages and gaining a holistic view of the value proposition of inventory routing. The thesis applies an exploratory case study design, which is based on normative quantitative empirical research using optimization, simulation and factor analysis. Data and results are drawn from a real world application to cash supply chains. The first research paper shows that performance gains require a common cost component and cannot be explained by simple linear or affine cost structures. Inventory management and distribution decisions become separable in the absence of a set-dependent cost structure, and neither economies of scope nor coordination problems are present in this case. The second research paper analyzes whether information sharing improves the overall forecasting accuracy. Analysis suggests that the potential for information sharing is limited to coordination of replenishments and that central information do not yield more accurate forecasts based on joint forecasting. The third research paper develops a novel formulation of the stochastic inventory routing model that accounts for minimal service levels and forecasting accuracy. The developed model allows studying the interaction of minimal service levels and forecasting accuracy with the underlying cost structure in inventory routing. Interestingly, results show that the factors minimal service level and forecasting accuracy are not statistically significant, and subsequently not relevant for the strategic decision problem to introduce inventory routing, or in other words, to effectively internalize inventory management and distribution decisions at the supplier. Consequently the main contribution of this thesis is the result that cost benefits of inventory routing are derived from the joint decision model that accounts for the underlying set-dependent cost structure rather than the level of information sharing. This result suggests that the value of information sharing of demand and inventory data is likely to be overstated in prior literature. In other words, cost benefits of inventory routing are primarily determined by the cost structure (i.e. level of fixed costs and transportation costs) rather than the level of information sharing, joint forecasting, forecasting accuracy or service levels.