Assessing economic and environmental impacts of subsidies for organic fertilizer in vegetable production: insights from a combined PMP-LCA-LCC approach

This study aims to investigate alternative scenarios of varying subsidies for organic fertilizer in terms of their impacts on organic and chemical fertilizer use, and the associated environmental impacts and economic performance. A positive mathematical programming model, combined with the life cycle assessment and costing approach, is formulated, to assess the data collected from 127 farmers in Boai County, China. The results show that the organic and chemical fertilizer, as well as diesel combustion are hotspots in vegetable production, contributing substantially to life cycle costs. With the implementation of subsidy policies, there is an increase in the use of organic fertilizer and a corresponding decrease in the use of chemical fertilizer. While this leads to increased environmental impacts such as global warming and ozone formation, around two-thirds of environmental impacts are reduced. As subsidy raises, the environmental cost increases and farm income show a decreasing trend. The study also identifies a critical subsidy value of 200–250 CNY/ton, with which the price subsidy may be optimum considering both the achievement of policy targets and alleviating burdens on public budget. Therefore, to improve the long-term sustainable agriculture development, some other policy instruments should be coupled with the price subsidy, and the level of subsidy should be appropriately formulated.