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Optimal Cost-Sharing Programs to Reduce Agricultural Pollution

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  • Shoemaker, Robbin A.
  • Malik, Arun S.

Abstract

Pollution from agriculture depends on the agricultural practices or technologies farmers use. Policy instruments, such as government cost-sharing programs, can reduce the costs of adopting less-polluting practices. This report examines the problem of designing economically efficient cost-sbaring programs. Farmers' decisions to adopt less-polluting technologies are based on the profitability of their farms' adjusting technology, compared with new technologies. A benchmark solution to the pollution problem serves as a reference against which to compare the optimal cost-Sharing policy with imperfect targeting of land. The optimal input subsidy scheme depends on the pollution being managed, costs associated with the participation constraint, and the social cost of public funds.

Suggested Citation

  • Shoemaker, Robbin A. & Malik, Arun S., 1993. "Optimal Cost-Sharing Programs to Reduce Agricultural Pollution," Technical Bulletins 157045, United States Department of Agriculture, Economic Research Service.
    • Handle: RePEc:ags:uerstb:157045
    DOI: 10.22004/ag.econ.157045
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    References listed on IDEAS

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    1. Osteen, Craig D. & Szmedra, Philip I., 1989. "Agricultural Pesticide Use Trends and Policy Issues," Agricultural Economic Reports 308081, United States Department of Agriculture, Economic Research Service.
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    3. James S. Shortle & James W. Dunn, 1986. "The Relative Efficiency of Agricultural Source Water Pollution Control Policies," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 68(3), pages 668-677.
    4. Negri, Donald H. & Hanchar, John J., 1989. "Water Conservation through Irrigation Technology," Agricultural Information Bulletins 309514, United States Department of Agriculture, Economic Research Service.
    5. Julian M. Alston & Brian H. Hurd, 1990. "Some Neglected Social Costs of Government Spending in Farm Programs," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 72(1), pages 149-156.
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    Cited by:

    1. Heimlich, Ralph E. & Claassen, Roger, 1998. "Agricultural Conservation Policy At A Crossroads," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 27(01), pages 1-13, April.
    2. Andrea Cattaneo, 2003. "The Pursuit of Efficiency and Its Unintended Consequences: Contract Withdrawals in the Environmental Quality Incentives Program," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 25(2), pages 449-469.
    3. Gregory Amacher & Peter Feather, 1997. "Testing producer perceptions of jointly beneficial best management practices for improved water quality," Applied Economics, Taylor & Francis Journals, vol. 29(2), pages 153-159.
    4. Lichtenberg, Erik & Smith-Ramirez, Ricardo, 2003. "Cost Sharing, Transaction Costs, And Conservation," 2003 Annual meeting, July 27-30, Montreal, Canada 22141, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    5. Lichtenberg, Erik, 2002. "Agriculture and the environment," Handbook of Agricultural Economics, in: B. L. Gardner & G. C. Rausser (ed.), Handbook of Agricultural Economics, edition 1, volume 2, chapter 23, pages 1249-1313, Elsevier.
    6. Ricardo Smith, 2006. "Measuring the Effects of Working-Land Conservation Programs on Adoption of Soil-Erosion Reducing Practices and Permanent Vegetative Cover," Working Papers DTE 369, CIDE, División de Economía.
    7. Cattaneo, Andrea, 2001. "Environmental Quality Incentives Program: Why Are So Many Contracts Being Cancelled?," 2001 Annual meeting, August 5-8, Chicago, IL 20597, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    8. Baerenklau, Kenneth A., 2002. "Green Payment Programs For Nonpoint Source Pollution Control: How Important Is Targeting For Cost-Effectiveness?," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 27(2), pages 1-14, December.

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