Price Endogeneity and Marginal Cost Effects on Incentive Compatible Stormwater Management Policies

Matthew C. Huber, David B. Willis, John C. Hayes and Privette, Charles V.,

No 61859, 2010 Annual Meeting, July 25-27, 2010, Denver, Colorado from Agricultural and Applied Economics Association

Abstract: Incentive based stormwater management policies offer the prospect of reducing urban stormwater runoff while increasing developer profits. An incentive compatible Stormwater Banking Program (SBP) is presented that allows developers to build at higher residential densities in exchange for including low impact stormwater Best Management Practices (BMPs) in the development’s stormwater management infrastructure. Price endogeneity presents itself when the smaller residential lots created by building at a greater density sell for a lower price than the original, larger lots. Stormwater management authorities must be aware of this and the effects of the program participation fee structure in designing voluntary incentive based policies that meet runoff reduction objectives.

Keywords: Farm; Management (search for similar items in EconPapers)
Pages: 34
Date: 2010
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Persistent link: https://EconPapers.repec.org/RePEc:ags:aaea10:61859

DOI: 10.22004/ag.econ.61859

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