Agriculture Reference
In-Depth Information
method aggregating a priori the criteria. For this purpose, the reference
point approach (Wierzbicki 1982) has been selected. Aspiration levels, set
by the DM, expressed on the criteria onto the efficient frontier resulting in
a solution corresponding to a specific tax exemption scheme. The efficient
frontier includes all non-dominated alternative choices. The exploration is
supported through an interactive adjustment of the aspiration levels on the
basis of solutions generated at previous iterations. This approach has been
used in various contexts, in particular in contexts involving environmental
aspects (Stam
et al.
1992). The following criteria are proposed in our case:
agricultural surplus, industry surpluses, public expenditure, GHG savings
(in t respectively estimated by relationships (1), (9), LHS of (11)
and (8) in Boxes 1 and 2.
Projection of aspiration levels expressed by the DM is performed
by optimising a scalarising function(s) that aims at satisfying the following
requirements: (a)
s
must generate efficient solutions only, and (b) all
efficient solutions may be generated by
s.
The first requirement is easily met since we work on the subset of
efficient solutions (190 out of 1980 in this case study). In order to satisfy
the second requirement, we selected the following scalarising function
derived from the weighted Tchebychev norm:
and
reference point representing aspiration levels
number of criteria (objectives)
maximum value on criterion
h
(ideal point
7
)
minimum value on criterion
h,
over the efficient set of
solutions (nadir point)
Optimising separately for each criterion results in quite different
strategies. The pay-off matrix illustrates conflicts among strategies as well
as possible trade-offs and provides useful information in a synthetic way.
In this case, very similar solutions optimise criteria agricultural surplus and
savings (one of the solutions optimising agricultural surplus is actually
the same as the one optimising savings), in other words, interests of
farmers and environmentalists coincide. This can be explained as higher
production levels and surpluses for farmers correspond to higher GHG
reductions.
The decision-making process can be reserved to public policy
makers or, alternatively, include stakeholders. During the interactive
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