EFFECTIVE COSTS AND CHEMICAL USE IN U.S. AGRICULTURAL PRODUCTION: BENEFITS AND COSTS OF USING THE ENVIRONMENT AS A "FREE" INPUT

Catherine Morrison Paul, V. Eldon Ball, Ronald G. Felthoven and Richard F. Nehring

No 11986, Working Papers from University of California, Davis, Department of Agricultural and Resource Economics

Abstract: This study uses a cost-function-based model of production processes in U.S. agriculture to represent producers' input and output decisions, and the implied costs of reductions in risk associated with leaching and runoff from agricultural chemical use. The model facilitates evaluation of the statistical significance of measured shadow values for "bad" outputs, and their input- and output-specific components, with a focus on the impacts on pesticide demand and its quality and quantity aspects. The shadow values of risk reduction are statistically significant, and imply increased demand for effective pesticides over time that stem largely from improvements in quality due to embodied technology, and that vary substantively by region.

Keywords: Environmental Economics and Policy; Farm Management (search for similar items in EconPapers)
Pages: 27
Date: 2000
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Persistent link: https://EconPapers.repec.org/RePEc:ags:ucdavw:11986

DOI: 10.22004/ag.econ.11986

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