Integrated assessment of nitrogen runoff to the Gulf of Mexico

Yuelu Xu, Levan Elbakidze, Haw Yen, Jeffrey G. Arnold, Philip Gassman, Jason Hubbart and Michael P. Strager

Resource and Energy Economics, 2022, vol. 67, issue C

Abstract: An integrated hydro-economic agricultural land use model was developed with endogenous and spatially explicit crop planting, nitrogen (N) fertilizer use and irrigation in the Mississippi River Basin (MRB). We used the model to quantify the effects of energy and N fertilizer prices on N runoff to the Gulf of Mexico. Results show a modest effect of energy costs and a more substantive impact of N fertilizer costs on N delivered to the Gulf of Mexico. A 30 % reduction (increase) in N fertilizer price leads to a 3.5 % and 1.5 % increase (2.9 % and 1.5 % decrease) in N use and runoff, respectively. The model was also used to estimate the opportunity cost of N runoff abatement. The opportunity cost of reducing N runoff from crop production to the Gulf by 45 % is estimated to be $6 billion annually, which corresponds to an average cost of $29.3 per kg of N runoff reduction. The results show heterogeneities in the optimal N runoff reduction efforts across counties within the MRB, demonstrating the significance of a targeted abatement strategy.

Keywords: Agricultural production; Fertilizer; Nitrogen; Hypoxia; Land use; Hydro-economic model (search for similar items in EconPapers)
JEL-codes: Q1 Q4 Q5 (search for similar items in EconPapers)
Date: 2022
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Persistent link: https://EconPapers.repec.org/RePEc:eee:resene:v:67:y:2022:i:c:s0928765521000646

DOI: 10.1016/j.reseneeco.2021.101279

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