Water Quality Trading Without Trades: An Analysis into the Lack of Agricultural Nonpoint Source Credit Demand in Virginia

Kurt Stephenson and Leonard Shabman

No 252701, 2017 Annual Meeting, February 4-7, 2017, Mobile, Alabama from Southern Agricultural Economics Association

Abstract: Governmental agencies and agricultural organizations promote water quality trading programs as an innovative policy to engage agricultural producers in conservation activities. Cost analyses suggest regulated sources can reduce compliance costs by purchasing agricultural nonpoint source credits. Yet, such “point-nonpoint” trades are rare. This paper assesses the demand for agricultural nonpoint sources in well-developed nutrient trading programs in Virginia for industrial and municipal wastewater treatment plants, municipal stormwater programs, and land developers. Evidence suggests nutrient trading programs in Virginia will not stimulate investments in pollutant reduction practices on working agricultural lands. The lack of demand for agricultural nonpoint source credits can be attributed to a substantial degree to the design features and incentives present in multiple overlapping regulatory programs.

Keywords: Environmental; Economics; and; Policy (search for similar items in EconPapers)
Pages: 47
Date: 2017
New Economics Papers: this item is included in nep-agr and nep-env
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Persistent link: https://EconPapers.repec.org/RePEc:ags:saea17:252701

DOI: 10.22004/ag.econ.252701

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