Implications of a Carbon-Based Energy Tax for U.S. Agriculture
Policies to mitigate greenhouse gas emissions are likely to increase energy prices. Higher energy prices raise farmer costs for diesel and other fuels, irrigation water, farm chemicals, and grain drying. Simultaneously, renewable energy options become more attractive to agricultural producers. We consider both of these impacts, estimating the economic and environmental consequences of higher energy prices on U.S. agriculture. To do this we employ a price-endogenous agricultural sector model and solve that model for a range of carbon-tax-based energy price changes. Our results show mostly positive impacts on net farm income in the intermediate run. Through market price adjustments, fossil fuel costs are largely passed on to consumers. Additional farm revenue arises from the production of biofuels when carbon taxes reach $30 per ton of carbon or more. Positive environmental benefits include not only greenhouse gas emission offsets but also reduced levels of nitrogen leaching.
Volume (Year): 34 (2005)
Issue (Month): 2 (October)
|Contact details of provider:|| Web page: http://www.narea.org/|
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Hayri Önal & Bruce A. McCarl, 1991. "Exact Aggregation in Mathematical Programming Sector Models," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 39(2), pages 319-334, 07.
- Konyar, Kazim & Howitt, Richard E., 2000. "The Cost Of The Kyoto Protocol To U.S. Crop Production: Measuring Crop Price, Regional Acreage, Welfare, And Input Substitution Effects," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 25(02), December.
- Uwe A. Schneider & Bruce A. McCarl, 2002. "Potential of U.S. Agriculture and Forestry to Mitigate Greenhouse Gas Emissions: An Agricultural Sector Analysis, The," Center for Agricultural and Rural Development (CARD) Publications 02-wp300, Center for Agricultural and Rural Development (CARD) at Iowa State University.
- Schneider, Uwe A. & Kumar, Pushpam, 2008. "Greenhouse Gas Mitigation through Agriculture," Choices, Agricultural and Applied Economics Association, vol. 23(1).
- Harry S. Baumes & Bruce A. McCarl, 1978. "Linear Programming And Social Welfare: Model Formulation And Objective Function Alternatives," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 26(3), pages 53-60, November.
- Uwe A. Schneider & Bruce A. McCarl, 2001.
"Economic Potential of Biomass-Based Fuels for Greenhouse Gas Emission Mitigation,"
Center for Agricultural and Rural Development (CARD) Publications
01-wp280, Center for Agricultural and Rural Development (CARD) at Iowa State University.
- Uwe Schneider & Bruce McCarl, 2003. "Economic Potential of Biomass Based Fuels for Greenhouse Gas Emission Mitigation," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 24(4), pages 291-312, April.
- Alig, Ralph J. & Adams, Darius M. & McCarl, Bruce A., 1998.
"Impacts Of Incorporating Land Exchanges Between Forestry And Agriculture In Sector Models,"
Journal of Agricultural and Applied Economics,
Southern Agricultural Economics Association, vol. 30(02), December.
- Alig, Ralph J. & Adams, Darius M. & McCarl, Bruce A., 1998. "Impacts of Incorporating Land Exchanges Between Forestry and Agriculture in Sector Models," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 30(02), pages 389-401, December.
- Spreen, Thomas H., 2006. "Price Endogenous Mathematical Programming Models and Trade Analysis," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 38(02), August.
- Antle, John M. & Capalbo, Susan Marie & Johnson, James B. & Miljkovic, Dragan, 1999. "The Kyoto Protocol: Economic Effects Of Energy Prices On Northern Plains Dryland Grain Production," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 28(1), April.
- Moreira, Jose R. & Goldemberg, Jose, 1999. "The alcohol program," Energy Policy, Elsevier, vol. 27(4), pages 229-245, April.
- Chen, Chi-Chung & McCarl, Bruce A., 2000. "The Value Of Enso Information To Agriculture: Consideration Of Event Strength And Trade," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 25(02), December.
When requesting a correction, please mention this item's handle: RePEc:ags:arerjl:10242. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.