An efficient cost-sharing program to reduce nonpoint-source contamination: theory and an application to groundwater contamination |
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Authors: | C. S. Kim G. D. Schaible S. G. Daberkow |
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Affiliation: | (1) Resource Economics Division, Rm. 4056, Economic Research Service, US Department of Agriculture, 1800 M Street NW, Washington DC 20036-5831, United States, e-mail: ckim@econ.ag.gov, US |
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Abstract: | This research evaluates the economics of cost-sharing improved irrigation technologies to reduce agricultural, nonpoint-source contamination. Irrigation and fertilization inefficiencies are modeled within a nonjoint production process to evaluate both private and public costs of technology adoption and its effect on groundwater nitrate-contamination levels. A central Nebraska application indicates that even without a current government subsidy, a farmer is economically better off switching from gravity-flow to surge-flow irrigation rather than a center-pivot system. An annual government subsidy of $22.50 (US$) per hectare per year is required over the life of a center-pivot system to make the farmer financially indifferent. However, cost-sharing center-pivot adoption improves the groundwater contamination level, while other irrigation systems result in continued deterioration of groundwater quality. Received: 3 November 1998 · Accepted: 15 February 1999 |
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Keywords: | Cost-share Irrigation Nitrogen fertilizer Nonjoint production |
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