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Implications of the Air Compliance Agreement for Livestock Producers

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  • Hadrich, Joleen C.
  • Wolf, Christopher A.

Abstract

Nutrient management and air emissions continue to be an area of increased management control on all livestock operations as environmental regulations become more stringent. Agricultural producers must consider uncertainty surrounding the timing of and potential increases of environmental policy controls, such as emission taxes, when making future investment decisions. An optimal control theory framework was applied to a dairy farm facing an uncertain increase in emission taxes and an unknown date at which emission taxes will take effect. The optimal investment path considering these uncertainties was solved implicitly and compared to a full certainty case.

Suggested Citation

  • Hadrich, Joleen C. & Wolf, Christopher A., 2009. "Implications of the Air Compliance Agreement for Livestock Producers," 2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin 49316, Agricultural and Applied Economics Association.
    • Handle: RePEc:ags:aaea09:49316
    DOI: 10.22004/ag.econ.49316
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    References listed on IDEAS

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    1. Y.H. Farzin & P.M. Kort, 2000. "Pollution Abatement Investment When Environmental Regulation Is Uncertain," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 2(2), pages 183-212, April.
    2. Richard Hartl & Peter Kort, 1996. "Capital accumulation of a firm facing an emissions tax," Journal of Economics, Springer, vol. 63(1), pages 1-23, February.
    3. Kort, P.M., 1993. "Pollution Control and the Dynamics of Firm : The Effects of Market Based Instruments on Optimal Firm Investments," Other publications TiSEM 7f93f736-2e2e-41e2-a3b5-c, Tilburg University, School of Economics and Management.
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    Keywords

    Environmental Economics and Policy; Livestock Production/Industries;

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