Nitrate Contamination of Groundwater: Determinants and Indicators

Katharina Wick, Christine Heumesser and Erwin Schmid

No 109430, 120th Seminar, September 2-4, 2010, Chania, Crete from European Association of Agricultural Economists

Abstract: Nitrogen is an important input to agricultural production but also detrimentally affects the environmental quality of air, soil and water. Identifying the determinants of nitrate pollution and in turn defining sensible performance indicators to design, enforce and monitor regulatory policies is therefore of utmost importance. Using data on more than 1000 Austrian municipalities, we provide a detailed econometric analysis of (1) the determinants of nitrate concentration in groundwater, and (2) the predictive abilities of one of the most commonly used agri-environmental indicators, the Nitrogen Balance. We find that the proportion of cropland exerts a positive effect on the nitrate content in groundwater. Additionally, environmental factors such as temperature and precipitation are found to be important. Higher average temperature leads to lower nitrate pollution of groundwater possibly due to increased evapotranspiration. Equally, higher average precipitation dilutes nitrate content in the soil, reducing nitrate concentration in groundwater. To assess the Nitrogen Balance, we link observed pollution levels to the theoretical indicator and evaluate its ability to measure nitrate pollution effects. Indeed, the indicator proves to be a good predictor for nitrate pollution. We also show that its predictive power can be improved if average precipitation of a region is taken into account. If average precipitation is higher, the Nitrogen Balance predicts nitrate levels in groundwater more precisely.

Keywords: Agricultural and Food Policy; Crop Production/Industries; Environmental Economics and Policy; Farm Management; Land Economics/Use; Production Economics (search for similar items in EconPapers)
Pages: 24
Date: 2010
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Persistent link: https://EconPapers.repec.org/RePEc:ags:eaa120:109430

DOI: 10.22004/ag.econ.109430

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