Spatial Effects of Nutrient Pollution on Drinking Water Production

This study explores the spatial effects in nitrogen (N) and phosphorus (P) pollution and drinking water production patterns in agriculture. Two important examples are that water utilities that deliver and treat drinking water in agricultural areas have to deal with excess nitrogen and phosphorus released to the environment by crop and livestock operations, an externality created by the agricultural sector; and, second, that the drinking water production sector in rural areas is a highly fragmented with a multitude of enterprise sizes, organization forms and network densities that have spatial components. In our analysis we present measures of N and P pollution. We employ information collected in section 303(d) of the Clean Water Act: count of impaired water bodies by N/P, and count of point source N/P pollution at the Hydrologic Unit Code 8 (HUC) or sub-basin level and estimate how these variables affect drinking water utilities scale economies, productive efficiency, and scale and scope economies.