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Economic and Water Quality Impacts of Reducing Nitrogen and Pesticide Use in Agriculture

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  • Randhir, Timothy O.
  • Lee, John G.

Abstract

A multiyear regional risk programming model was used in evaluating the impacts of different environmental policies on cropping systems, input use, nonpoint source pollution, farm income, and risk. A direct expected utility maximizing problem (DEMP) objective with a Von Neuman Morgenstern utility function was used in deriving optimal cropping systems. A biophysical simulation model provided input for the optimization. Three types of policies—taxing, regulating the aggregate, and regulating the per acre level—were studied for two farm inputs—nitrogen and atrazine. It was observed that policies had varied and multiple cross-effects on pollutant loads, farm income, and risk. This information is crucial in developing successful policies toward improving water quality. If an appropriate input policy is chosen, both targeted and nontargeted pollutant loads can be managed. The three policies varied in their effects on pollutant loads and involved tradeoffs in water quality and economic attributes.

Suggested Citation

  • Randhir, Timothy O. & Lee, John G., 1997. "Economic and Water Quality Impacts of Reducing Nitrogen and Pesticide Use in Agriculture," Agricultural and Resource Economics Review, Cambridge University Press, vol. 26(1), pages 39-51, April.
    • Handle: RePEc:cup:agrerw:v:26:y:1997:i:01:p:39-51_00
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    Cited by:

    1. Gordon, Simon, 2003. "Economic Instruments For Nonpoint Source Water Pollution: Options For The Swan-Canning River System," 2003 Conference (47th), February 12-14, 2003, Fremantle, Australia 57873, Australian Agricultural and Resource Economics Society.
    2. Westra, John V., 1999. "Agricultural Phosphorus Nonpoint Source Pollution In The Minnesota River," 1999 Annual meeting, August 8-11, Nashville, TN 21490, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    3. Schläpfer, Felix & Erickson, Jon D., 2001. "A Biotic Control Perspective on Nitrate Contamination of Groundwater from Agricultural Production," Agricultural and Resource Economics Review, Cambridge University Press, vol. 30(2), pages 113-126, October.
    4. Yiridoe, Emmanuel K. & Weersink, Alfons, 1998. "Marginal Abatement Costs Of Reducing Groundwater-N Pollution With Intensive And Extensive Farm Management Choices," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 27(2), pages 1-17, October.
    5. Matekole, Augustus N. & Westra, John V., 2009. "Economic Analysis of Tillage and Nutrient Best Management Practices in the Ouachita River Basin, Louisiana," 2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin 49519, Agricultural and Applied Economics Association.
    6. Ekman, Sone, 2002. "Cost-Effective Farm-Level Nitrogen Abatement in the Presence of Environmental and Economic Risk," 2002 International Congress, August 28-31, 2002, Zaragoza, Spain 24860, European Association of Agricultural Economists.
    7. Ribaudo, Marc O. & Heimlich, Ralph & Claassen, Roger & Peters, Mark, 2001. "Least-cost management of nonpoint source pollution: source reduction versus interception strategies for controlling nitrogen loss in the Mississippi Basin," Ecological Economics, Elsevier, vol. 37(2), pages 183-197, May.
    8. Luc Valentin & Daniel J. Bernardo & Terry L. Kastens, 2004. "Testing the Empirical Relationship between Best Management Practice Adoption and Farm Profitability," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 26(4), pages 489-504.
    9. Parsons, Oliver, 2012. "Community Governance: An Alternative Approach to Regulation and Market Mechanisms for Management of Nitrogen Loss," 2012 Conference, August 31, 2012, Nelson, New Zealand 136053, New Zealand Agricultural and Resource Economics Society.
    10. Ipe, Viju C. & DeVuyst, Eric A. & Braden, John B. & White, David C., 2001. "Simulation Of A Group Incentive Program For Farmer Adoption Of Best Management Practices," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 30(2), pages 1-12, October.
    11. Glenn Sheriff, 2005. "Efficient Waste? Why Farmers Over-Apply Nutrients and the Implications for Policy Design," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 27(4), pages 542-557.
    12. Mapp, Harry P., Jr., 1999. "Impact Of Production Changes On Income And Environmental Risk In The Southern High Plains," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 31(2), pages 1-11, August.
    13. Apland, Jeffrey & Grainger, Corbett & Strock, Jeffrey, 2004. "Modeling Agricultural Production Considering Water Quality and Risk," Staff Papers 14240, University of Minnesota, Department of Applied Economics.
    14. Ipe, Viju C. & DeVuyst, Eric A., 1999. "A Group Incentive Program For Farmer Adoption Of Best Management Practices: An Application To The Nitrate Pollution Problem In Central Illinois," 1999 Annual meeting, August 8-11, Nashville, TN 21704, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    15. Westra, John V. & Olson, Kent D., 2001. "Enviro-Economic Analysis Of Phosphorus Nonpoint Pollution," 2001 Annual meeting, August 5-8, Chicago, IL 20653, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    16. Aillery, Marcel P. & Gollehon, Noel R. & Johansson, Robert C. & Kaplan, Jonathan D. & Key, Nigel D. & Ribaudo, Marc, 2005. "Managing Manure To Improve Air And Water Quality," Economic Research Report 33593, United States Department of Agriculture, Economic Research Service.
    17. Spencer, Daniel S. & Barnes, James N. & Coatney, Kalyn T. & Parman, Bryon J. & Coble, Keith H., 2017. "Property Rights And The Economics Of Non-Point Source Water Regulations In Agriculture: A New Biophysical-Economic Methodological Approach," 2017 Annual Meeting, February 4-7, 2017, Mobile, Alabama 252835, Southern Agricultural Economics Association.

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