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Do farmers overuse nitrogen fertilizer to the detriment of the environment?

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  • Satya Yadav
  • Willis Peterson
  • K. Easter

Abstract

Increasing use of nitrogen fertilizer in U.S. agriculture has led to nitrate contamination of water resources. The main objective of the study is to determine if the current use of nitrogen exceeds the profit-maximizing level, since reducing such discrepancy, if any, could raise farmers' profitability and enhance water quality making it a win-win situation. Specific objectives of the study, however, are two-fold. First, develop an appropriate methodology for estimation of an agronomic production function utilizing panel data with several treatments from experimental plots. Second, using experimental data from 1987 through 1990 for three farm sites in southeastern Minnesota, empirically estimate the production function and profit maximizing level of nitrogen application. Our results show that both the current recommended rate, 150 1b/acre, and farmers' use, 176 1b/acre, of nitrogen exceed the profit maximizing level of nitrogen in the region. It is shown that the recommended rate needs to be revised and made more site or area specific rather than a general figure for the entire region. The study shows considerable residual nitrogen build-up in the soil profile, implying that farmers have been applying more nitrogen than could be utilized by corn plants. The later finding highlights the importance of soil testing for plant nutrients when making decisions on fertilizer application. Copyright Kluwer Academic Publishers 1997

Suggested Citation

  • Satya Yadav & Willis Peterson & K. Easter, 1997. "Do farmers overuse nitrogen fertilizer to the detriment of the environment?," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 9(3), pages 323-340, April.
    • Handle: RePEc:kap:enreec:v:9:y:1997:i:3:p:323-340
    DOI: 10.1007/BF02441403
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    1. Vroomen, Harry, 1989. "Fertilizer Use and Price Statistics, 1960-88," Statistical Bulletin 154682, United States Department of Agriculture, Economic Research Service.
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    Cited by:

    1. Kibrom A. Abay & Lina Abdelfattah & Hoda El‐Enbaby & Mai Mahmoud & Clemens Breisinger, 2022. "Plot size and sustainable input intensification in smallholder irrigated agriculture: Evidence from Egypt," Agricultural Economics, International Association of Agricultural Economists, vol. 53(5), pages 792-810, September.
    2. Burkhart, Christopher S. & Jha, Manoj K., 2012. "Site-Specific Simulation of Nutrient Control Policies: Integrating Economic and Water Quality Effects," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 37(1), pages 1-14, April.
    3. Nurmakhanova, Mira, 2008. "Essays on fall fertilizer application," ISU General Staff Papers 2008010108000016739, Iowa State University, Department of Economics.
    4. Yiridoe, Emmanuel K. & Amon-Armah, Frederick & Hebb, Dale & Jamieson, Rob, 2013. "Eco-efficiency of Alternative Cropping Systems Managed in an Agricultural Watershed," 2013 Annual Meeting, August 4-6, 2013, Washington, D.C. 150357, Agricultural and Applied Economics Association.
    5. Francisco Rosas & Bruce Babcock & Dermot Hayes, 2015. "Nitrous oxide emission reductions from cutting excessive nitrogen fertilizer applications," Climatic Change, Springer, vol. 132(2), pages 353-367, September.
    6. 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.
    7. Sumelius, John & Grgic, Zoran & Mesic, Milan & Franic, Ramona, 2003. "Marginal Abatement Costs For Reducing Leaching Of Nitrates In Croatian Farming Systems," 2003 Annual Meeting, August 16-22, 2003, Durban, South Africa 25909, International Association of Agricultural Economists.
    8. Sumelius, John & Grgic, Zoran & Mesic, Milan & Franic, Ramona, 2002. "Farm level cost of reducing nitrate leaching by economic instruments in Croatian farming systems," Discussion Papers 18884, CEESA: Central and Eastern European Sustainable Agriculture International Research Project.
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    10. Homayounfar, Mehran & Muneepeerakul, Rachata & Martinez, Christopher J., 2023. "Navigating farming-BMP-policy interplay through a dynamical model," Ecological Economics, Elsevier, vol. 205(C).
    11. Mohammad Mahbubur Rahman & Jeffry D. Connor, 2022. "Impact of Agricultural Extension Services on Fertilizer Use and Farmers’ Welfare: Evidence from Bangladesh," Sustainability, MDPI, vol. 14(15), pages 1-16, July.
    12. 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, Cambridge University Press, vol. 30(2), pages 139-150, October.
    13. Khor, Ling & Zeller, Manfred, 2015. "Perception of Substandard Fertilizer and Its Impact on Use Intensity," 2015 Conference, August 9-14, 2015, Milan, Italy 211843, International Association of Agricultural Economists.
    14. Rajsic, Predrag & Weersink, Alfons, 2008. "Do farmers waste fertilizer? A comparison of ex post optimal nitrogen rates and ex ante recommendations by model, site and year," Agricultural Systems, Elsevier, vol. 97(1-2), pages 56-67, April.
    15. Sarkar, Sampriti & Lupi, Frank, 2022. "Modelling mid-western corn yield response to phosphorus fertilizer in Michigan," 2022 Annual Meeting, July 31-August 2, Anaheim, California 322478, Agricultural and Applied Economics Association.
    16. Williamson, James M., 2010. "Does Information Matter? Assessing the Role of Information and Prices in the Nitrogen Fertilizer Management Decision," 2010 Annual Meeting, July 25-27, 2010, Denver, Colorado 60892, Agricultural and Applied Economics Association.
    17. Bikram K. Das & Robiul Islam Rubel & Surbhi Gupta & Yajun Wu & Lin Wei & Volker S. Brözel, 2022. "Impacts of Biochar-Based Controlled-Release Nitrogen Fertilizers on Soil Prokaryotic and Fungal Communities," Agriculture, MDPI, vol. 12(10), pages 1-15, October.
    18. Metcalfe, Todd & Bosch, Darrell J. & Pease, James W. & Alley, Mark M. & Phillips, Steve B., 2007. "Yield Reserve Program Costs in the Virginia Coastal Plain," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 36(2), pages 1-16, October.
    19. Khor, Ling & Ufer, Susanne & Nielsen, Thea & Zeller, Manfred, 2015. "The Influence of Individual Risk Behavior on Fertilizer Use Decision in Vietnam," 2015 Conference, August 9-14, 2015, Milan, Italy 211844, International Association of Agricultural Economists.
    20. Williamson, James M., 2011. "The Role of Information and Prices in the Nitrogen Fertilizer Management Decision: New Evidence from the Agricultural Resource Management Survey," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 36(3), pages 1-21.
    21. David C. Lane & Birgit Kopainsky & Ali Kerem Saysel, 2017. "Role of Information Feedback in Soil Nitrogen Management: Results from a Dynamic Simulation Game," Systems Research and Behavioral Science, Wiley Blackwell, vol. 34(4), pages 424-439, July.
    22. Allen G Good & Perrin H Beatty, 2011. "Fertilizing Nature: A Tragedy of Excess in the Commons," PLOS Biology, Public Library of Science, vol. 9(8), pages 1-9, August.
    23. Gandorfer, Markus & Rajsic, Predrag, 2008. "Modeling Economic Optimum Nitrogen Rates for Winter Wheat When Inputs Affect Yield and Output-Price," Agricultural Economics Review, Greek Association of Agricultural Economists, vol. 9(2).
    24. Picazo-Tadeo, Andres J. & Reig-Martinez, Ernest, 2007. "Farmers' costs of environmental regulation: Reducing the consumption of nitrogen in citrus farming," Economic Modelling, Elsevier, vol. 24(2), pages 312-328, March.

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