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Optimal Management of a Eutrophied Coastal Ecosystem: Balancing Agricultural and Municipal Abatement Measures

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  • Laukkanen, Marita
  • Huhtala, Anni

Abstract

Agriculture and municipal wastewater are the principal sources of eutrophying nutrients in many water ecosystems. We develop a model which considers the characteristics of agricultural and municipal nutrient abatement. The model explicitly accounts for the investment needed to set up wastewater treatment facilities, and makes it possible to determine the optimal timing of investment as well as the optimal agricultural and municipal abatement levels. We apply the model to the Finnish coastal waters of the Gulf of Finland. Our results indicate that substantial savings in abatement costs and the damage associated with eutrophication could be obtained by constructing the facilities needed to process all the wastewaters entering the coastal ecosystem. The optimal timing of investment is shown to hinge on both the economic and ecological characteristics of the ecosystem.

Suggested Citation

  • Laukkanen, Marita & Huhtala, Anni, 2006. "Optimal Management of a Eutrophied Coastal Ecosystem: Balancing Agricultural and Municipal Abatement Measures," Discussion Papers 11856, MTT Agrifood Research Finland.
  • Handle: RePEc:ags:mttfdp:11856
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    References listed on IDEAS

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    Cited by:

    1. Elofsson, Katarina & Gren, Ing-Marie, 2014. "Cost-efficient climate policies for interdependent and uncertain carbon pools," Working Paper Series 2014:7, Swedish University of Agricultural Sciences, Department Economics.
    2. repec:eee:juipol:v:46:y:2017:i:c:p:58-70 is not listed on IDEAS
    3. Ahlvik, Lassi & Hyytiäinen, Kari, 2015. "Value of adaptation in water protection — Economic impacts of uncertain climate change in the Baltic Sea," Ecological Economics, Elsevier, vol. 116(C), pages 231-240.
    4. Gren, Ing-Marie, 2009. "A numerical model for dynamic cost effective mitigation of eutrophication with spatial heterogeneity in the Baltic Sea," Department of Economics publications 4311, Swedish University of Agricultural Sciences, Department of Economics.
    5. Sergey Rabotyagov & Catherine L. Kling & Philip W. Gassman & Nancy N. Rabalais & R. Eugene Turner, 2012. "Economics of Dead Zones: Linking Externalities from the Land to their Consequences in the Sea, The," Center for Agricultural and Rural Development (CARD) Publications 12-wp534, Center for Agricultural and Rural Development (CARD) at Iowa State University.
    6. repec:gam:jsusta:v:10:y:2018:i:5:p:1419-:d:144436 is not listed on IDEAS
    7. Kuosmanen, Timo & Laukkanen, Marita, 2009. "(In)Efficient Management of Interacting Environmental Bads," Discussion Papers 54287, MTT Agrifood Research Finland.
    8. Doole, Graeme J., 2012. "Cost-effective policies for improving water quality by reducing nitrate emissions from diverse dairy farms: An abatement–cost perspective," Agricultural Water Management, Elsevier, vol. 104(C), pages 10-20.
    9. Kari Hyytiäinen & Anni Huhtala, 2014. "Combating eutrophication in coastal areas at risk for oil spills," Annals of Operations Research, Springer, vol. 219(1), pages 101-121, August.
    10. Kari Hyytiäinen & Lassi Ahlvik & Heini Ahtiainen & Janne Artell & Anni Huhtala & Kim Dahlbo, 2015. "Policy Goals for Improved Water Quality in the Baltic Sea: When do the Benefits Outweigh the Costs?," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 61(2), pages 217-241, June.
    11. Elofsson, Katarina, 2014. "International knowledge diffusion and its impact on the cost-effective clean-up of the Baltic Sea," Working Paper Series 2014:06, Swedish University of Agricultural Sciences, Department Economics.
    12. Hyytiainen, Kari & Ahtiainen, Heini & Heikkila, Jaakko & Helin, Janne & Huhtala, Anni & Iho, Antti & Koikkalainen, Kauko & Miettinen, Antti & Pouta, Eija & Vesterinen, Janne, 2009. "An integrated simulation model to evaluate national policies for the abatement of agricultural nutrients in the Baltic Sea," Discussion Papers 49896, MTT Agrifood Research Finland.

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