ANALIZING WATER FRAMEWORK DIRECTIVE IMPACTS USING A MULTINOMIAL LOGIT LAND USE MODEL

Carlo Fezzi, Ian Bateman, Brett H. Day, Paulette Posen and Dan Rigby

No 6666, 107th Seminar, January 30-February 1, 2008, Sevilla, Spain from European Association of Agricultural Economists

Abstract: We develop a two-stage, multinomial logit model of UK land use to investigate the impact of policy changes upon agriculture. The model utilizes a large panel database covering the entirety of England and Wales for 14 years between 1969 and 2004 integrated with the economic and physical environment determinants of all major agricultural land use types. Our model performs well in out-of-sample prediction of current land use and we use it to assess a proposed implementation of the Water Framework Directive via a tax on fertilizer. Results indicate that such policy change would generate substantial switching from arable to grassland systems, reducing significantly the amount of nitrate leaching into UK water-bodies.

Keywords: Agricultural and Food Policy; Land Economics/Use; Research Methods/Statistical Methods; Resource/Energy Economics and Policy (search for similar items in EconPapers)
Pages: 13
Date: 2008
New Economics Papers: this item is included in nep-dcm
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Persistent link: https://EconPapers.repec.org/RePEc:ags:eaa107:6666

DOI: 10.22004/ag.econ.6666

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