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Social Welfare And Environmental Degradation In Agriculture: The Case Of Ecuador

Author

Listed:
  • Segarra, Eduardo
  • Torre Ugarte, Daniel de la
  • Malaga, Jaime E.
  • Williams, Gary W.

Abstract

A non-linear optimization model which maximizes total Ecuadorian social welfare, defined as the sum of consumers' and producers' surpluses for the four major crops (corn, bananas, rice and African palm) is developed to evaluate the tradeoff between welfare and environmental degradation in Ecuador. It was found that a total welfare loss of US$122 million (a 11 percent reduction - from US$ 1.112 billion to US$ 989.66 million) would be expected from a 30 percent reduction in the total pesticide load on the environment in the production of the four major crops. The distributional impacts of the welfare loss were found, however, to be significantly skewed toward the loss of consumers' surplus. Specifically, a 30 percent reduction of total pesticide load on the environment would result in a reduction of 3.86 percent of producers' total surplus while consumers would be expected to loose 19.46 percent of their total surplus.

Suggested Citation

  • Segarra, Eduardo & Torre Ugarte, Daniel de la & Malaga, Jaime E. & Williams, Gary W., 2003. "Social Welfare And Environmental Degradation In Agriculture: The Case Of Ecuador," 2003 Annual Meeting, August 16-22, 2003, Durban, South Africa 25822, International Association of Agricultural Economists.
  • Handle: RePEc:ags:iaae03:25822
    DOI: 10.22004/ag.econ.25822
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    File URL: https://ageconsearch.umn.edu/record/25822/files/cp03se01.pdf
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    Cited by:

    1. Soares, Wagner Lopes & Porto, Marcelo Firpo, 2006. "Atividade Agrícola E Externalidade Ambiental: Uma Análise A Partir Do Uso De Agrotóxicos No Cerrado Brasileiro," 44th Congress, July 23-27, 2006, Fortaleza, Ceará, Brazil 147144, Sociedade Brasileira de Economia, Administracao e Sociologia Rural (SOBER).
    2. Arno Tausch & Almas Heshmati, 2012. "Migration, Openness and the Global Preconditions of "Smart Development"," Bogazici Journal, Review of Social, Economic and Administrative Studies, Bogazici University, Department of Economics, vol. 26(2), pages 1-62.

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    Keywords

    Environmental Economics and Policy;

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