Abatement Cost Heterogeneity and its Impact on Tradable Nitrogen Discharge Permits

Thiagarajah Ramilan and Francis Scrimgeour

No 31972, 2006 Conference, August 24-25, 2006, Nelson, New Zealand from New Zealand Agricultural and Resource Economics Society

Abstract: Nitrogen discharge into the Waikato River has been identified as the primary source of potential water quality degradation. Rising nitrogen levels in water are attributed to non point source pollution from agricultural activities. Pastoral farming is the predominant agricultural land use in the catchment. Increased nitrogen fertilizer use and higher stocking rates have the potential to increase the nitrogen loading into water. There is a range of best management practices and policies proposed to reduce nitrogen discharge from farming systems. Water quality trading is a policy tool that could improve the cost effectiveness of achieving environmental goals. Economic theory suggests that tradable pollution permit systems encourage polluters to reallocate pollution burdens to take advantage of any differences in marginal abatement costs. This paper develops an analytical frame work to derive nitrogen abatement costs for farms in a Waikato river sub-catchment. Policies and practices are evaluated using a bio-economic model of a typical pastoral farm in the Waikato river sub-catchment. Implications of pollution trading at the farm level are examined using programming simulation models.

Keywords: Environmental; Economics; and; Policy (search for similar items in EconPapers)
Pages: 18
Date: 2006
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://ageconsearch.umn.edu/record/31972/files/cp06ra01.pdf (application/pdf)

Related works:
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:ags:nzasin:31972

DOI: 10.22004/ag.econ.31972

Access Statistics for this paper

More papers in 2006 Conference, August 24-25, 2006, Nelson, New Zealand from New Zealand Agricultural and Resource Economics Society Contact information at EDIRC.
Bibliographic data for series maintained by AgEcon Search ().