Simulated Trading for Maryland's Nitrogen Loadings in the Chesapeake Bay
We 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 a market by trading high-cost upgrades of sewage treatment plants for low-cost winter cover crops. Under an optimistic assumption about costs for non-point sources and naÃ¯ve assumptions about the lag from planting cover crops to changes in nitrogen load, we calculate that 100 percent of abatement could be achieved at 56 percent of total costs, while in a pessimistic scenario, 100 percent of abatement could be could be achieved at 83 percent of total costs.
Volume (Year): 37 (2008)
Issue (Month): 2 (October)
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- David A. Hennessy & Hongli Feng, 2008.
"When Should Uncertain Nonpoint Emissions Be Penalized in a Trading Program?,"
American Journal of Agricultural Economics,
Agricultural and Applied Economics Association, vol. 90(1), pages 249-255.
- Hennessy, David A. & Feng, Hongli, 2007. "When Should Uncertain Nonpoint Emissions be Penalized in a Trading Program?," 2007 Annual Meeting, July 29-August 1, 2007, Portland, Oregon TN 9805, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
- Hennessy, David A. & Feng, Hongli, 2008. "When Should Uncertain Nonpoint Emissions Be Penalized in a Trading Program?," Staff General Research Papers Archive 12868, Iowa State University, Department of Economics.
- Shortle, James S., 1987. "Allocative Implications Of Comparisons Between The Marginal Costs Of Point And Nonpoint Source Pollution Abatement," Northeastern Journal of Agricultural and Resource Economics, Northeastern Agricultural and Resource Economics Association, vol. 16(1), April.
- Arun S. Malik & David Letson & Stephen R. Crutchfield, 1993. "Point/Nonpoint Source Trading of Pollution Abatement: Choosing the Right Trading Ratio," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 75(4), pages 959-967.
- Richard Schmalensee & Paul L. Joskow & A. Denny Ellerman & Juan Pablo Montero & Elizabeth M. Bailey, 1998. "An Interim Evaluation of Sulfur Dioxide Emissions Trading," Journal of Economic Perspectives, American Economic Association, vol. 12(3), pages 53-68, Summer.
- 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. Full references (including those not matched with items on IDEAS)