Nutrient Allowances Market and Wetland Abatement
AbstractThe buffering function of wetlands is one of the most efficient mechanisms for regulating agricultural runoffs and water pollution. The aim of this paper is to show how farmers could use wetland abatement as a way to achieve pollution targets set by a regulator in a nutrient allowance market. The introduction of allowances into farmers’ maximisation programs creates an incentive to either reduce fertilizer use per hectare of crops, or to restore wetlands on agricultural land. Comparative statics results express a negative correlation between the quantity of allowances per farmer and the fertilizer use. Furthermore, the quantity of allowances per farmer is negatively correlated to the wetland surface area.
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Bibliographic InfoPaper provided by FAERE - French Association of Environmental and Resource Economists in its series Working Papers with number 2014.06.
Length: 20 pages
Date of creation: May 2014
Date of revision: May 2014
Nutrients; Wetlands; Agriculture; Permit market; Regulation; Allowances; Runoffs;
Find related papers by JEL classification:
- Q15 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Land Ownership and Tenure; Land Reform; Land Use; Irrigation; Agriculture and Environment
- Q28 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Government Policy
This paper has been announced in the following NEP Reports:
- NEP-AGR-2014-05-24 (Agricultural Economics)
- NEP-ALL-2014-05-24 (All new papers)
- NEP-ENV-2014-05-24 (Environmental Economics)
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