Nutrient Trading, the Flush Tax, and Maryland's Nitrogen Emissions to the Chesapeake Bay
AbstractWe investigate nutrient trading for point and non-point sources for the Bay Restoration Fund in Maryland. We demonstrate how to use the proceeds from the tax revenue to mimic trading high-cost upgrades of sewage treatment plants for low-cost winter cover crops. Under an optimistic assumption about costs for non-point sources, we calculate that abatement could be increased by more than 50%, while in a pessimistic scenario, abatement could be increased by 2%. We also explore the role of uncertainty in determining the appropriate trading ratio between point and non-point sources of pollution, showing that the higher uncertainty associated with non-point sources should induce a lower trading ratio.
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Bibliographic InfoPaper provided by University of Maryland, Department of Agricultural and Resource Economics in its series Working Papers with number 7343.
Date of creation: 2007
Date of revision:
Chesapeake Bay; cover crops; nitrogen abatement; nutrient trading; sewage treatment plants; trading ratios; water pollution; Environmental Economics and Policy;
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- Richard D. Horan, 2001. "Differences in Social and Public Risk Perceptions and Conflicting Impacts on Point/Nonpoint Trading Ratios," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 83(4), pages 934-941.
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