Simulating SOC changes in 11 land use change chronosequences from the Brazilian Amazon with RothC and Century models

Land use and land cover changes in the Brazilian Amazon have major implications for regional and global carbon (C) cycling. Cattle pasture represents the largest single use (about 70%) of this once-forested land in most of the region. The main objective of this study was to evaluate the accuracy of the RothC and Century models at estimating soil organic C (SOC) changes under forest-to-pasture conditions in the Brazilian Amazon. We used data from 11 site-specific 'forest to pasture' chronosequences with the Century Ecosystem Model (Century 4.0) and the Rothamsted C Model (RothC 26.3). The models predicted that forest clearance and conversion to well managed pasture would cause an initial decline in soil C stocks (0-20 cm depth), followed in the majority of cases by a slow rise to levels exceeding those under native forest. One exception to this pattern was a chronosequence in Suia-Missu, which is under degraded pasture. In three other chronosequences the recovery of soil C under pasture appeared to be only to about the same level as under the previous forest. Statistical tests were applied to determine levels of agreement between simulated SOC stocks and observed stocks for all the sites within the 11 chronosequences. The models also provided reasonable estimates (coefficient of correlation = 0.8) of the microbial biomass C in the 0-10 cm soil layer for three chronosequences, when compared with available measured data. The Century model adequately predicted the magnitude and the overall trend in delta C-13 for the six chronosequences where measured 813 C data were available. This study gave independent tests of model performance, as no adjustments were made to the models to generate outputs. Our results suggest that modelling techniques can be successfully used for monitoring soil C stocks and changes, allowing both the identification of current patterns in the soil and the projection of future conditions. Results were used and discussed not only to evaluate soil C dynamics but also to indicate soil C sequestration opportunities for the Brazilian Amazon region. Moreover, modelling studies in these 'forest to pasture' systems have important applications, for example, the calculation of CO, emissions from land use change in national greenhouse gas inventories. (0 2007 Elsevier B.V. All rights reserved.

Robust dynamics of Amazon dieback to climate change with perturbed ecosystem model parameters

Climate change science is increasingly concerned with methods for managing and integrating sources of uncertainty from emission storylines, climate model projections, and ecosystem model parameterizations. In tropical ecosystems, regional climate projections and modeled ecosystem responses vary greatly, leading to a significant source of uncertainty in global biogeochemical accounting and possible future climate feedbacks. Here, we combine an ensemble of IPCC-AR4 climate change projections for the Amazon Basin (eight general circulation models) with alternative ecosystem parameter sets for the dynamic global vegetation model, LPJmL. We evaluate LPJmL simulations of carbon stocks and fluxes against flux tower and aboveground biomass datasets for individual sites and the entire basin. Variability in LPJmL model sensitivity to future climate change is primarily related to light and water limitations through biochemical and water-balance-related parameters. Temperature-dependent parameters related to plant respiration and photosynthesis appear to be less important than vegetation dynamics (and their parameters) for determining the magnitude of ecosystem response to climate change. Variance partitioning approaches reveal that relationships between uncertainty from ecosystem dynamics and climate projections are dependent on geographic location and the targeted ecosystem process. Parameter uncertainty from the LPJmL model does not affect the trajectory of ecosystem response for a given climate change scenario and the primary source of uncertainty for Amazon 'dieback' results from the uncertainty among climate projections. Our approach for describing uncertainty is applicable for informing and prioritizing policy options related to mitigation and adaptation where long-term investments are required.

Environmental control for layers

Light patterns have less effect on numbers of eggs laid by current stocks than on those of forty years ago, but the principles have not changed. Ovarian activity is stimulated by increasing photoperiods and suppressed by decreasing photoperiods. The light pattern used during rearing can still have large effects on age at 50% lay, even for modern stocks. Early sexual maturity maximises egg numbers but gives smaller eggs. Late maturity maximises egg size at the expense of numbers. The relationship between egg output (g/hen d) and age at first egg is curvilinear, with maximum yield occurring in flocks maturing in about the centre of their potential range. Fancy patterns of increasing daylength after maturity are probably not justified. A flock held on a constant 14h day will lay as many eggs as one given step up lighting. Intermittent lighting saves about 5% of feed consumption with no loss of output, provided that the feed has adequate amino acid content to allow for the reduced feed intake. Producers with light-proof laying houses should be taking advantage of intermittent lighting. The recommended light intensity for laying houses is still 10 lx, although the physiological threshold for response to changes in photoperiod is closer to 2 lx. Very dim (0.05 lx) light filtering into blacked out houses will not stimulate the hypothalamic receptors responsible for photo-sexual responses, but may affect the bird's biological clock, which can alter its response to a constant short photoperiod. Feed intake shows a curvilinear dependence on environmental temperature. At temperatures below the panting threshold, performance can be maintained by adjusting the feed so as to maintain an adequate intake of critical amino acids. Above the panting threshold, the hen is unable to take in enough energy to maintain normal output. There is no dietary modification which can effectively offset this problem. Diurnally cycling temperatures result in feed intake and egg production equivalent to that observed under a constant temperature equal to the mean of the cycle. When the poultry house is cooler at night than by day, it helps to provide light so that the birds can feed during the cooler part of the cycle.

GISQ, a multifunctional indicator of soil quality

We present here an indicator of soil quality that evaluates soil ecosystem services through a set of 5 subindicators, and further combines them into a single general Indicator of Soil Quality (GISQ). We used information derived from 54 properties commonly used to describe the multifaceted aspects of soil quality. The design and calculation of the indicators were based on sequences of multivariate analyses. Subindicators evaluated the physical quality, chemical fertility, organic matter stocks, aggregation and morphology of the upper 5 cm of soil and the biodiversity of soil macrofauna. A GISQ combined the different subindicators providing a global assessment of soil quality. Research was conducted in two hillside regions of Colombia and Nicaragua, with similar types of land use and socio-economic context. However, soil and climatic conditions differed significantly. In Nicaragua, soil quality was assessed at 61 points regularly distributed 200 m apart on a regular grid across the landscape. In Colombia, 8 plots representing different types of land use were arbitrarily chosen in the landscape and intensively sampled. Indicators that were designed in the Nicaragua site were further applied to the Colombian site to test for their applicability. In Nicaragua, coffee plantations, fallows, pastures and forest had the highest values of GISQ (1.00; 0.80; 0.78 and 0.77, respectively) while maize crops and eroded soils (0.19 and 0.10) had the lowest values. Examination of subindicator values allowed the separate evaluation of different aspects of soil quality: subindicators of organic matter, aggregation and morphology and biodiversity of macrofauna had the maximum values in coffee plantations (0.89; 0.72 and 0.56, respectively on average) while eroded soils had the lowest values for these indicators (0.10; 0.31 and 0.33, respectively). Indicator formulae derived from information gained at the Nicaraguan sites were not applicable to the Colombian situation and site-specific constants were calculated. This indicator allows the evaluation of soil quality and facilitates the identification of problem areas through the individual values of each subindicator. It allows monitoring of change through time and can guide the implementation of soil restoration technologies. Although GISQ formulae computed on a set of data were only valid at a regional scale, the methodology used to create these indices can be applied everywhere.

Incubation success of released hand-reared pheasants Phasianus colchicus compared with wild ones

We investigated previously observed but unexplained differences in incubation success between wild and hand-reared common pheasants Phasianus colchicus. Hand-reared birds are widely released in late summer in Britain and elsewhere to supplement wild stocks for shooting purposes. We radio-tracked 53 wild and 35 previously released reared female pheasants occupying simultaneously the same areas on a game-keepered estate in eastern England between February and mid July 1999 and 2000. Predation of adult birds was comparatively low for both wild and reared birds, and overall survival did not differ between years or between groups. However, of 52 nests incubated by wild females 49% hatched, whereas of 30 nests incubated by reared pheasants only 22% hatched. Mayfield estimates of daily nest survival probability thus differed significantly between groups. However, predation of eggs was similar for both wild and reared birds. Instead the observed difference in hatch rates was due to nest abandonment, with more reared females (41%) deserting apparently unmolested nest sites than wild females (6%).

Effect of soil waterlogging on below-ground biomass allometric relations in Norway spruce

An increasing importance is assigned to the estimation and verification of carbon stocks in forests. Forestry practice has several long-established and reliable methods for the assessment of aboveground biomass; however we still miss accurate predictors of belowground biomass. A major windthrow event exposing the coarse root systems of Norway spruce trees allowed us to assess the effects of contrasting soil stone and water content on belowground allocation. Increasing stone content decreases root/shoot ratio, while soil waterlogging leads to an increase in this ratio. We constructed allometric relationships for belowground biomass prediction and were able to show that only soil waterlogging significantly impacts model parameters. We showed that diameter at breast height is a reliable predictor of belowground biomass and, once site-specific parameters have been developed, it is possible to accurately estimate belowground biomass in Norway spruce.

Biomass partitioning and growth efficiency in four naturally regenerated forest tree species

Current forest growth models and yield tables are almost exclusively based on data from mature trees, reducing their applicability to young and developing stands. To address this gap, young European beech, sessile oak, Scots pine and Norway spruce trees approximately 0 to 10 years old were destructively sampled in a range of naturally regenerated forest stands in Central Europe. Diameter at base and height were first measured in situ for up to 175 individuals per species. Subsequently, the trees were excavated and dry biomass of foliage, branches, stems and roots was measured. Allometric relations were then used to calculate biomass allocation coefficients (BAC) and growth efficiency (GE) patterns in young trees. We found large differences in BAC and GE between broadleaves and conifers, but also between species within these categories. Both BAC and GE are strongly age-specific in young trees, their rapidly changing values reflecting different growth strategies in the earliest stages of growth. We show that linear relationships describing biomass allocation in older trees are not applicable in young trees. To accurately predict forest biomass and carbon stocks, forest growth models need to include species and age specific parameters of biomass allocation patterns.

The value premium and time-varying volatility

Numerous studies have documented the failure of the static and conditional capital asset pricing models to explain the difference in returns between value and growth stocks. This paper examines the post-1963 value premium by employing a model that captures the time-varying total risk of the value-minus-growth portfolios. Our results show that the time-series of value premia is strongly and positively correlated with its volatility. This conclusion is robust to the criterion used to sort stocks into value and growth portfolios and to the country under review (the US and the UK). Our paper is consistent with evidence on the possible role of idiosyncratic risk in explaining equity returns, and also with a separate strand of literature concerning the relative lack of reversibility of value firms' investment decisions.

Climate change and the British Uplands: evidence for decision-making

We summarise the work of an interdisciplinary network set up to explore the impacts of climate change in the British Uplands. In this CR Special, the contributors present the state of knowledge and this introduction synthesises this knowledge and derives implications for decision makers. The Uplands are valued semi-natural habitats, providing ecosystem services that have historically been taken for granted. For example, peat soils, which are mostly found in the Uplands, contain around 50% of the terrestrial carbon in the UK. Land management continues to be a driver of ecosystem service delivery. Degraded and managed peatlands are subject to erosion and carbon loss with negative impacts on biodiversity, carbon storage and water quality. Climate change is already being experienced in British Uplands and is likely to exacerbate these pressures. Climate envelope models suggest as much as 50% of British Uplands and peatlands will be exposed to climate stress by the end of the 21st century under low and high emissions scenarios. However, process-based models of the response of organic soils to this climate stress do not give a consistent indication of what this will mean for soil carbon: results range from a very slight increase in uptake, through a clear decline, to a net carbon loss. Preserving existing peat stocks is an important climate mitigation strategy, even if new peat stops forming. Preserving upland vegetation cover is a key win–win management strategy that will reduce erosion and loss of soil carbon, and protect a variety of services such as the continued delivery of a high quality water resource.

Corporate social performance and stock returns: UK evidence from disaggregate measures

This study examines the relation between corporate social performance and stock returns in the UK. We closely evaluate the interactions between social and financial performance with a set of disaggregated social performance indicators for environment, employment, and community activities instead of using an aggregate measure. While scores on a composite social performance indicator are negatively related to stock returns, we find the poor financial reward offered by such firms is attributable to their good social performance on the environment and, to a lesser extent, the community aspects. Considerable abnormal returns are available from holding a portfolio of the socially least desirable stocks. These relationships between social and financial performance can be rationalized by multi-factor models for explaining the cross-sectional variation in returns, but not by industry effects.

Autoregressive conditional kurtosis

This article proposes a new model for autoregressive conditional heteroscedasticity and kurtosis. Via a time-varying degrees of freedom parameter, the conditional variance and conditional kurtosis are permitted to evolve separately. The model uses only the standard Student’s t-density and consequently can be estimated simply using maximum likelihood. The method is applied to a set of four daily financial asset return series comprising U.S. and U.K. stocks and bonds, and significant evidence in favor of the presence of autoregressive conditional kurtosis is observed. Various extensions to the basic model are proposed, and we show that the response of kurtosis to good and bad news is not significantly asymmetric.

The inflation hedging characteristics of US and UK investments: a multi-factor error correction approach

Historic analysis of the inflation hedging properties of stocks produced anomalous results, with equities often appearing to offer a perverse hedge against inflation. This has been attributed to the impact of real and monetary shocks to the economy, which influence both inflation and asset returns. It has been argued that real estate should provide a better hedge: however, empirical results have been mixed. This paper explores the relationship between commercial real estate returns (from both private and public markets) and economic, fiscal and monetary factors and inflation for US and UK markets. Comparative analysis of general equity and small capitalisation stock returns in both markets is carried out. Inflation is subdivided into expected and unexpected components using different estimation techniques. The analyses are undertaken using long-run error correction techniques. In the long-run, once real and monetary variables are included, asset returns are positively linked to anticipated inflation but not to inflation shocks. Adjustment processes are, however, gradual and not within period. Real estate returns, particularly direct market returns, exhibit characteristics that differ from equities.

Diversification when it hurts? The joint distributions of real estate and equity markets

Much of the literature on the construction of mixed asset portfolios and the case for property as a risk diversifier rests on correlations measured over the whole of a given time series. Recent developments in finance, however, focuses on dependence in the tails of the distribution. Does property offer diversification from equity markets when it is most needed - when equity returns are poor. The paper uses an empirical copula approach to test tail dependence between property and equity for the UK and for a global portfolio. Results show strong tail dependence: in the UK, the dependence in the lower tail is stronger than in the upper tail, casting doubt on the defensive properties of real estate stocks.

Explaining deviations from NAV in UK property companies: rationality and sentimentality

One of the most vexing issues for analysts and managers of property companies across Europe has been the existence and persistence of deviations of Net Asset Values of property companies from their market capitalisation. The issue has clear links to similar discounts and premiums in closed-end funds. The closed end fund puzzle is regarded as an important unsolved problem in financial economics undermining theories of market efficiency and the Law of One Price. Consequently, it has generated a huge body of research. Although it can be tempting to focus on the particular inefficiencies of real estate markets in attempting to explain deviations from NAV, the closed end fund discount puzzle indicates that divergences between underlying asset values and market capitalisation are not a ‘pure’ real estate phenomenon. When examining potential explanations, two recurring factors stand out in the closed end fund literature as often undermining the economic rationale for a discount – the existence of premiums and cross-sectional and periodic fluctuations in the level of discount/premium. These need to be borne in mind when considering potential explanations for real estate markets. There are two approaches to investigating the discount to net asset value in closed-end funds: the ‘rational’ approach and the ‘noise trader’ or ‘sentiment’ approach. The ‘rational’ approach hypothesizes the discount to net asset value as being the result of company specific factors relating to such factors as management quality, tax liability and the type of stocks held by the fund. Despite the intuitive appeal of the ‘rational’ approach to closed-end fund discounts the studies have not successfully explained the variance in closed-end fund discounts or why the discount to net asset value in closed-end funds varies so much over time. The variation over time in the average sector discount is not only a feature of closed-end funds but also property companies. This paper analyses changes in the deviations from NAV for UK property companies between 2000 and 2003. The paper present a new way to study the phenomenon ‘cleaning’ the gearing effect by introducing a new way of calculating the discount itself. We call it “ungeared discount”. It is calculated by assuming that a firm issues new equity to repurchase outstanding debt without any variation on asset side. In this way discount does not depend on an accounting effect and the analysis should better explain the effect of other independent variables.

The impact of real estate on the mixed-asset portfolio in periods of financial stress

The case for holding real estate in the mixed-asset portfolio is typically made on its stabilising effect as a result of its diversification benefits. However, portfolio diversification often fails when it is most needed, i.e. during periods of financial stress. In these periods, the variability of returns for most asset classes increases thus reducing the stabilising effect of a diversified portfolio. This paper applies the approach of Chow et al (1999) to the US domestic mixed-asset portfolio to establish whether real estate, represented by REITs, is especially useful in times of financial stress. To this end monthly returns data on five assets classes: large cap stocks, small cap stocks, long dated government bonds, cash (T-Bills) and real estate (REITs) are evaluated over the period January 1972 to December 2001. The results indicate that the inclusion of REITs in the mixed-asset portfolio can lead to increases or decreases in returns depending on the asset class replaced and whether the period is one of calm or stress. However, the inclusion of REITs invariably leads to reductions in portfolio risk that are greater than any loss in return, especially in periods of financial stress. In other words, REITs acts as a stabilising force on the mixed-asset portfolio when it is most needed, i.e. in periods of financial stress.