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Dynamic Optimization of Nitrogen Use When Groundwater Contamination Is Internalized at the Standard in the Long Run

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  • Satya N. Yadav

Abstract

An economic relationship between agricultural production and groundwater pollution is established first by analyzing the problem in a dynamic setting. Using experimental data from 1987 to 1990 from three sites, optimal policy rules that would maintain the nitrate contamination level at the 10 mg/l standard over time are determined next. Nitrogen application rates are then determined based on the optimal policy rule and available residual nitrogen in the root-zone layer. It is shown that in the first year one of the sites should be fertilized at a lower-than-profit-maximizing rate while the other two sites should not be fertilized at all. Copyright 1997, Oxford University Press.

Suggested Citation

  • Satya N. Yadav, 1997. "Dynamic Optimization of Nitrogen Use When Groundwater Contamination Is Internalized at the Standard in the Long Run," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 79(3), pages 931-945.
    • Handle: RePEc:oup:ajagec:v:79:y:1997:i:3:p:931-945
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    1. Farquharson, Robert J. & Cacho, Oscar J. & Mullen, John D., 2005. "An economic approach to soil fertility management for wheat production in New South Wales and Queensland," 2005 Conference (49th), February 9-11, 2005, Coff's Harbour, Australia 137866, Australian Agricultural and Resource Economics Society.
    2. Hubert Stahn & Agnes Tomini, 2014. "On the Environmental Efficiency of Water Storage: The Case of a Conjunctive Use of Ground and Rainwater," Working Papers halshs-01083461, HAL.
    3. Alassane Drabo, 2010. "Environment Quality and Economic Convergence: Extending Environmental Kuznets Curve Hypothesis," Economics Bulletin, AccessEcon, vol. 30(2), pages 1617-1632.
    4. Dias, Weeratilake & Helmers, Glenn A. & Eghball, Bahman, 1999. "Economic And Environmental Risk Efficiency Analysis Of Land Application Of Cattle Feedlot Manure: Generalized Stochastic Dominance Analysis," 1999 Annual Meeting, July 11-14, 1999, Fargo, ND 35715, Western Agricultural Economics Association.
    5. Muhammad N. Ashraf & Muhammad H. Mahmood & Muhammad Sultan & Narges Banaeian & Muhammad Usman & Sobhy M. Ibrahim & Muhammad U. B. U. Butt & Muhammad Waseem & Imran Ali & Aamir Shakoor & Zahid M. Khan, 2020. "Investigation of Input and Output Energy for Wheat Production: A Comprehensive Study for Tehsil Mailsi (Pakistan)," Sustainability, MDPI, vol. 12(17), pages 1-22, August.
    6. Sanchari Ghosh & Keith Willett, 2012. "Empirical Assessment of the quantity-quality tradeoff for the Ogallala: A case study from West Texas," Economics Working Paper Series 1201, Oklahoma State University, Department of Economics and Legal Studies in Business.
    7. Phoebe Koundouri, 2004. "Current Issues in the Economics of Groundwater Resource Management," Journal of Economic Surveys, Wiley Blackwell, vol. 18(5), pages 703-740, December.
    8. Roseta-Palma, Catarina, 2002. "Groundwater Management When Water Quality Is Endogenous," Journal of Environmental Economics and Management, Elsevier, vol. 44(1), pages 93-105, July.
    9. Catarina Roseta-Palma, 2003. "Joint Quantity/Quality Management of Groundwater," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 26(1), pages 89-106, September.
    10. Alassane DRABO, 2010. "Interrelationships between Health, Environment Quality and Economic Activity: What Consequences for Economic Convergence," Working Papers 201005, CERDI.
    11. Goetz, Renan-Ulrich & Keusch, Alois, 2005. "Dynamic efficiency of soil erosion and phosphor reduction policies combining economic and biophysical models," Ecological Economics, Elsevier, vol. 52(2), pages 201-218, January.
    12. Encarna Esteban & Ariel Dinar, 2013. "Cooperative Management of Groundwater Resources in the Presence of Environmental Externalities," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 54(3), pages 443-469, March.
    13. Yusuke Kuwayama & Nicholas Brozović, 2017. "Optimal Management of Environmental Externalities with Time Lags and Uncertainty," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 68(3), pages 473-499, November.
    14. Van Asselt, Joanna & Grogan, Kelly A., 2020. "Do Fertilizer Subsidies Improve Soil Quality: Myopic vs. Dynamic Analysis of Smallholder Farmers in Ghana," 2020 Annual Meeting, July 26-28, Kansas City, Missouri 304546, Agricultural and Applied Economics Association.
    15. Sihvonen, Matti & Pihlainen, Sampo & Lai, Tin-Yu & Salo, Tapio & Hyytiäinen, Kari, 2021. "Crop production, water pollution, or climate change mitigation—Which drives socially optimal fertilization management most?," Agricultural Systems, Elsevier, vol. 186(C).
    16. Yang, Ziyan, 2015. "A Dynamic Economic Analysis of Nitrogen-Induced Soil Acidification in China," 2015 AAEA & WAEA Joint Annual Meeting, July 26-28, San Francisco, California 205112, Agricultural and Applied Economics Association.
    17. Kenneth A. Baerenklau & Nermin Nergis & Kurt A. Schwabe, 2008. "Effects of Nutrient Restrictions on Confined Animal Facilities: Insights from a Structural‐Dynamic Model," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 56(2), pages 219-241, June.
    18. Alassane Drabo, 2011. "Interrelationships among Health, Environment Quality, and Economic Activity: What Consequences for Economic Convergence?," WIDER Working Paper Series wp-2011-034, World Institute for Development Economic Research (UNU-WIDER).
    19. Farquharson, Robert J. & Cacho, Oscar J. & Turpin, J.E., 2000. "Agricultural response analysis in a longer term framework," 2000 Conference (44th), January 23-25, 2000, Sydney, Australia 123634, Australian Agricultural and Resource Economics Society.
    20. Baerenklau, Kenneth A. & Nergis, Nermin & Schwabe, Kurt A., 2007. "Effects of Nutrient Restrictions on Confined Animal Facilities: Insights from a Structural Model," 2007 Annual Meeting, July 29-August 1, 2007, Portland, Oregon 10253, Western Agricultural Economics Association.

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