COST SHARING, TRANSACTION COSTS, AND CONSERVATION

Erik Lichtenberg and Ricardo Smith-Ramirez

No 22141, 2003 Annual meeting, July 27-30, Montreal, Canada from American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association)

Abstract: Conservation subsidies may be awarded for otherwise profitable projects, in which case they do not improve environmental quality. We show that transaction costs involved in such subsidy programs may induce farmers to reduce the size and scope of conservation projects. An empirical study shows that cost sharing in Maryland has resulted in simpler projects that provide no greater environmental protection. Water quality does not appear to be a goal of cost sharing; farm productivity and political considerations do.

Keywords: Agribusiness (search for similar items in EconPapers)
Pages: 41
Date: 2003
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:aaea03:22141

DOI: 10.22004/ag.econ.22141

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