Perverse Incentives with Pay for Performance: Cover Crops in the Chesapeake Bay Watershed

Darrell Bosch, James W. Pease, Robert Wieland and Doug Parker

Agricultural and Resource Economics Review, 2013, vol. 42, issue 3, 491-507

Abstract: Policymakers are concerned about nitrogen and phosphorus export to water bodies. Exports may be reduced by paying farmers to adopt practices to reduce runoff or by paying performance incentives tied to estimated run-off reductions. We evaluate the cost-effectiveness of practice and performance incentives for reducing nitrogen exports. Performance incentives potentially improve farm-level and allocative efficiencies relative to practice incentives. However, the efficiency improvements can be undermined by baseline shifts when growers adopt crops that enhance the performance payments but cause more pollution. Policymakers must carefully specify rules for performance-incentive programs and payments to avoid such baseline shifting.

Date: 2013
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://www.cambridge.org/core/product/identifier/ ... type/journal_article link to article abstract page (text/html)

Related works:
Journal Article: Perverse Incentives with Pay for Performance: Cover Crops in the Chesapeake Bay Watershed (2013)
Journal Article: Perverse Incentives with Pay for Performance: Cover Crops in the Chesapeake Bay Watershed (2013)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:cup:agrerw:v:42:y:2013:i:03:p:491-507_00

Access Statistics for this article

More articles in Agricultural and Resource Economics Review from Cambridge University Press Cambridge University Press, UPH, Shaftesbury Road, Cambridge CB2 8BS UK.
Bibliographic data for series maintained by Kirk Stebbing ().