Can economic incentives encourage actual reductions in pesticide use and environmental spillovers?

Abstract

Chemical pesticides constitute an important input in crop production. But their indiscriminate use can impact negatively agricultural productivity, human health, and the environment. Recently, attention is focused on the use of economic incentives to reduce pesticide use and its related indirect effects. The aim of this work is to assess the effectiveness of different economic instruments such as taxes and levies in encouraging farmers to decrease pesticide use and their environmental spillovers. A policy simulation model is employed using data from Dutch cash crop producers including two pesticide categories that differ in terms of toxicity and pesticides’ environmental spillovers. Four different instruments were selected for evaluation: pesticide taxes, price penalties on pesticides’ environmental spillovers, subsidies, and quotas. The results of the study indicate that even high taxes and penalties would result in a small decrease in pesticide use and environmental spillovers. Taxes that differentiate according to toxicity do not lead to substitution of high‐ with low‐toxicity pesticides. Subsidies on low‐toxicity products are not able to affect the use of high‐toxicity products. Pesticide quotas are more effective in reducing pesticide use and environmental spillovers.

Spatial diversification of agroecosystems to enhance biological control and other regulating services: An agroecological perspective

“…The efficiency of different incentive tools is discussed (e.g. pesticide taxation, quotas of pesticide use, subsidies) (Jacquet et al, 2011;Skevas et al, 2012). In other words, should farmers alone support the costs?…”

European Pesticide Tax Schemes in Comparison: An Analysis of Experiences and Developments

“…However, in order to reduce the reliance on pesticides significantly (and not making them dependent on less hazardous ones), a tax scheme has to go hand in hand with accompanying measures promoting preventive measures of integrated pest management. In the short-term, no environmental and human health benefits will be observed due to large hoarding activities by retailers and farmers (peaks in Figures 1-3), and low price elasticities [67,73]. So far, no clear indication could be found in the literature whether a tax is efficient or not: for example, Reus et al [11] find no notable or only a moderate effectiveness, whereas Oskam et al [5] and Falconer [12] notice a high/positive effectiveness.…”

“…The Netherlands, for example, have had several pesticide tax debates which led to the denial of a proposed taxation in the beginning of the millennium [3,64]. Arguments against a fiscal instrument were the relatively high organizational effort [65], the low elasticity of demand, and the higher burdens for domestic producers as well as leakage through import [3,66] (for the elasticity see also [67]). The aims proclaimed in the NAP until 2010 were reached at least partially: large parts of targets regarding environmental load and residue limits in water supply and food have been reached [68].…”

Economic benefits of precision weed control and why its uptake is so slow

“…The tax on these chemicals in itself does not reduce their use if it is not paired with the compensation of revenues (Falconer and Hodge, 2000). Skevasa et al (2012) confi rmed through the use of models that, in contrast to taxes on pesticides, the low toxicity pesticides, pesticide quotas and the support of environmentally friendly R&D results can reduce agrochemical use. From studies of French vineyards, Lescot et al (2011) have found that both environmental taxes and green subsidies can contribute to the returns on precision means.…”