Designing watershed programs to pay farmers for water quality services: Case studies of Munich and New York City
While preserving water quality by contracting with farmers has been examined previously, we analyze these arrangements from a different perspective. This study uses a transaction cost framework, in conjunction with detailed case studies of two water quality payment schemes, to examine factors that increase and decrease transaction costs in order to improve policy choice as well as policy design and implementation. In both the Munich and New York City cases, agreements with farmers to change land management practices resolved the water quality problems. In Munich, factors including lack of rural/urban antipathy, homogeneous land use, utilization of well-developed organic standards, and strong demand for organic products decreased transaction costs. Using existing organic institutions addressed a range of environmental issues simultaneously. Factors that decreased transaction costs in both cases included: highly sensitive land was purchased outright and the existence of one large “buyer”. Adequate lead time and flexibility of water quality regulations allowed negotiation and development of the watershed programs. Tourism and eco-labels allow urban residents to become aware of the agricultural production practices that affect their water supply. We conclude with recommendations based on the experiences of these cities, both of which have been proposed as models for other schemes.
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
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.:
- Anderson, Terry L., 2004. "Donning Coase‐coloured glasses: a property rights view of natural resource economics," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 48(3), September.
- Lynn Hunnicutt & John Keith & Ruby Ward, 2002.
"If You Can't Trust the Farmer, Who Can You Trust? The Effect of Certification Types on Purchases of Organic Produce,"
2002-18, Utah State University, Department of Economics.
- Ward, Ruby A. & Hunnicutt, Lynn & Keith, John E., 2004. "If You Can't Trust the Farmer, Who Can You Trust? The Effect of Certification Types on Purchases of Organic Produce," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association (IFAMA), vol. 7(01).
- Coase, R H, 1992.
"The Institutional Structure of Production,"
American Economic Review,
American Economic Association, vol. 82(4), pages 713-19, September.
- Dahlman, Carl J, 1979. "The Problem of Externality," Journal of Law and Economics, University of Chicago Press, vol. 22(1), pages 141-62, April.
- Baylis, Kathy & Peplow, Stephen & Rausser, Gordon & Simon, Leo, 2008. "Agri-environmental policies in the EU and United States: A comparison," Ecological Economics, Elsevier, vol. 65(4), pages 753-764, May.
- Terry L. Anderson, 2004. "Donning Coase-coloured glasses: a property rights view of natural resource economics," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 48(3), pages 445-462, 09.
- Oliver E. Williamson, 2000. "The New Institutional Economics: Taking Stock, Looking Ahead," Journal of Economic Literature, American Economic Association, vol. 38(3), pages 595-613, September.
- Delate, K. M. & Duffy, Michael & Chase, Craig A. & Holste, A. & Friedrich, H. & Wantate, N, 2003. "An Economic Comparison of Organic and Conventional Grain Crops in a Long-Term Agroecological Research (Ltar) Site in Iowa," Staff General Research Papers Archive 11818, Iowa State University, Department of Economics.
- Joan Hoffman, 2008. "Census Peek: Collaboration in the New York City Catskill/Delaware Watershed: Case Study 1990–2000," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 10(2), pages 129-156, April.
- Madhu Khanna & William Rose Q. Anton, 2002. "Corporate Environmental Management: Regulatory and Market-Based Incentives," Land Economics, University of Wisconsin Press, vol. 78(4), pages 539-558.
- Douadia Bougherara & Gilles Grolleau & Naoufel Mzoughi, 2009. "The ‘make or buy’ decision in private environmental transactions," European Journal of Law and Economics, Springer, vol. 27(1), pages 79-99, February.
- Christophe Depres & Gilles Grolleau & Naoufel Mzoughi, 2008.
"Contracting for Environmental Property Rights: The Case of Vittel,"
London School of Economics and Political Science, vol. 75(299), pages 412-434, 08.
- Depres, Christophe & Grolleau, Gilles & Mzoughi, Naoufel, 2005. "Contracting for Environmental Property Rights: The Case of Vittel," 2005 International Congress, August 23-27, 2005, Copenhagen, Denmark 24729, European Association of Agricultural Economists.
- McCann, Laura & Colby, Bonnie & Easter, K. William & Kasterine, Alexander & Kuperan, K.V., 2005. "Transaction cost measurement for evaluating environmental policies," Ecological Economics, Elsevier, vol. 52(4), pages 527-542, March.
- Anna Alberini & Kathleen Segerson, 2002. "Assessing Voluntary Programs to Improve Environmental Quality," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 22(1), pages 157-184, June.
- George J. Mailath & Andrew Postlewaite, 1990. "Asymmetric Information Bargaining Problems with Many Agents," Review of Economic Studies, Oxford University Press, vol. 57(3), pages 351-367.
- Emery N. Castle, 1965. "The Market Mechanism, Externalities, and Land Economics," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 47(3), pages 542-556.
- Paavola, Jouni & Adger, W. Neil, 2005. "Institutional ecological economics," Ecological Economics, Elsevier, vol. 53(3), pages 353-368, May.
- Arthur, W Brian, 1989. "Competing Technologies, Increasing Returns, and Lock-In by Historical Events," Economic Journal, Royal Economic Society, vol. 99(394), pages 116-31, March.
When requesting a correction, please mention this item's handle: RePEc:eee:ecolec:v:76:y:2012:i:c:p:87-94. 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: (Shamier, Wendy)
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.