Paradox for Agro-Environmental Land Policy, A
AbstractA regulator with a fixed budget to spend on securing environmental benefits from farmed land has to choose between how many acres to enroll and the extent of benefits to require of each enrolled acre. Here we consider, given heterogeneous land, what properties of the environmental benefit-to-cost ratio imply for the choice of optimal program as the available budget varies. Conditions are found such that a program of high benefits on few acres is preferred for any budget level. It is also possible that a program delivering low benefits per acre at low cost is preferred on each land type, and yet a high benefit program is optimal policy, a variant of Simpson's paradox.
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Bibliographic InfoPaper provided by Center for Agricultural and Rural Development (CARD) at Iowa State University in its series Center for Agricultural and Rural Development (CARD) Publications with number 09-wp499.
Date of creation: Oct 2009
Date of revision:
benefit-to-cost ratio; environmental policy; land heterogeneity; Simpson's paradox.;
Find related papers by JEL classification:
- D6 - Microeconomics - - Welfare Economics
- Q2 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation
This paper has been announced in the following NEP Reports:
- NEP-AGR-2009-10-10 (Agricultural Economics)
- NEP-ALL-2009-10-10 (All new papers)
- NEP-ENV-2009-10-10 (Environmental Economics)
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