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A Multi-Objective Approach to Integrating Agricultural Economic and Environmental Policies


  • Lakshminarayan, P. G.
  • Johnson, Stanley R.
  • Bouzaher, Aziz


Agricultural nonpoint source pollution of soil and water resources is a major societal concern. Because of unabated NPS pollution, and despite more than a decade of policy, research and intervention, the relationship between agricultural production and environmental performance is still the subject of ongoing debate. Invariably, the environmental objectives conflict with one another and the policy choices involve significant trade-offs. The trade-off between soil erosion and water quality is a typical example of this contradiction. This paper describes a theory and conceptual framework for integrated agricultural economic and environmental modelling using a multicriteria decision-making approach grounded in multi-attribute utility theory. The empirical analysis and policy exercise evaluates policy trade-offs using a watershed-based model. The intent is to develop and implement a framework for policy analysis that provides for a better understanding of why some environmental problems persist despite evolving policies, technologies and market incentives. The multi-objective decision-making model is empirically verified for a specific eastern Iowa watershed. Two key results stand out from empirical analysis. There is a significant trade-off between economic and environmental goals, and even between environmental goals; therefore, a comprehensive analysis with reasonable compromise will give an ideal solution. Incorporating environmental objectives encouraged more environmentally sound cropping practices. In particular, environmentally sustainable crop rotation practices such as corn-soybeans-hay/oats was chosen more frequently by the model.

Suggested Citation

  • Lakshminarayan, P. G. & Johnson, Stanley R. & Bouzaher, Aziz, 1995. "A Multi-Objective Approach to Integrating Agricultural Economic and Environmental Policies," Staff General Research Papers Archive 955, Iowa State University, Department of Economics.
  • Handle: RePEc:isu:genres:955

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    References listed on IDEAS

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    5. Vicki A. McCracken & Jon A. Brandt, 1987. "Household Consumption of Food-Away-From-Home: Total Expenditure and by Type of Food Facility," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 69(2), pages 274-284.
    6. Arabmazar, Abbas & Schmidt, Peter, 1981. "Further evidence on the robustness of the Tobit estimator to heteroskedasticity," Journal of Econometrics, Elsevier, vol. 17(2), pages 253-258, November.
    7. Blundell, Richard & Meghir, Costas, 1987. "Bivariate alternatives to the Tobit model," Journal of Econometrics, Elsevier, vol. 34(1-2), pages 179-200.
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    9. Amemiya, Takeshi & Powell, James L., 1981. "A comparison of the Box-Cox maximum likelihood estimator and the non-linear two-stage least squares estimator," Journal of Econometrics, Elsevier, vol. 17(3), pages 351-381, December.
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    Cited by:

    1. Cisneros, J.M. & Grau, J.B. & Antón, J.M. & de Prada, J.D. & Cantero, A. & Degioanni, A.J., 2011. "Assessing multi-criteria approaches with environmental, economic and social attributes, weights and procedures: A case study in the Pampas, Argentina," Agricultural Water Management, Elsevier, vol. 98(10), pages 1545-1556, August.
    2. repec:spr:annopr:v:245:y:2016:i:1:d:10.1007_s10479-014-1606-6 is not listed on IDEAS
    3. Si Mokrane Siad & Andrea Gioia & Gerrit Hoogenboom & Vito Iacobellis & Antonio Novelli & Eufemia Tarantino & Pandi Zdruli, 2017. "Durum Wheat Cover Analysis in the Scope of Policy and Market Price Changes: A Case Study in Southern Italy," Agriculture, MDPI, Open Access Journal, vol. 7(2), pages 1-20, February.
    4. Jolejole, Christina B. & Swinton, Scott M. & Robertson, G. Philip & Syswerda, Sara P., 2009. "Profitability and Environmental Stewardship for Row Crop Production: Are There Trade-offs?," 2009 Conference, August 16-22, 2009, Beijing, China 50920, International Association of Agricultural Economists.
    5. Doltra, J. & Muñoz, P., 2010. "Simulation of nitrogen leaching from a fertigated crop rotation in a Mediterranean climate using the EU-Rotate_N and Hydrus-2D models," Agricultural Water Management, Elsevier, vol. 97(2), pages 277-285, February.

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