Abstract:This page was generated automatically upon download from the ETH Zurich Research Collection. For more information please consult the Terms of use. ETH Library 1 Postprint This is the accepted version of a paper published in Agricultural Systems. This paper has been peerreviewed but does not include the final publisher proof-corrections or journal pagination.
“…Fertilizer is found to increase risk significantly in both Models (no significant differences between Models, in line with results from marginal effects). This finding is coherent with empirical evidence for Switzerland (Finger, 2012).…”
The reduction of adverse health and environmental effects from pesticide use is currently a top priority on the agricultural policy agenda. Efficient pesticide policies must take into account farmers' application behavior, especially effects of pesticide use on economic risk. However, previous results regarding the direction of risk effects of pesticides are ambiguous. We show that the ambiguity in earlier studies could be due to the pesticide indicator selected. Indicators which fail to account for the heterogeneous properties of pesticides may be inapt for interpreting farmers' pesticide use decisions. Our analysis, based on a rich panel dataset of Swiss wheat producers with highly detailed information on pesticide use, considers different pesticide indicators and multiple sources of uncertainty. Our key finding is that indicator choice affects the magnitude and sign of estimated risk effects. Estimates of pesticide productivity and risk effects are significantly higher for fungicides, and even reversed for herbicides when we measure pesticide use in simple quantity units (kilogram per hectare)compared to the quality and intensity corrected Load Index. This means for example, that farmers will ceteris paribus use lower quantities of herbicides, but will increase the overall toxicity of the products applied with increasing risk aversion. We discuss implications of our findings for the design of pesticide policies and agricultural risk management instruments.
“…Fertilizer is found to increase risk significantly in both Models (no significant differences between Models, in line with results from marginal effects). This finding is coherent with empirical evidence for Switzerland (Finger, 2012).…”
The reduction of adverse health and environmental effects from pesticide use is currently a top priority on the agricultural policy agenda. Efficient pesticide policies must take into account farmers' application behavior, especially effects of pesticide use on economic risk. However, previous results regarding the direction of risk effects of pesticides are ambiguous. We show that the ambiguity in earlier studies could be due to the pesticide indicator selected. Indicators which fail to account for the heterogeneous properties of pesticides may be inapt for interpreting farmers' pesticide use decisions. Our analysis, based on a rich panel dataset of Swiss wheat producers with highly detailed information on pesticide use, considers different pesticide indicators and multiple sources of uncertainty. Our key finding is that indicator choice affects the magnitude and sign of estimated risk effects. Estimates of pesticide productivity and risk effects are significantly higher for fungicides, and even reversed for herbicides when we measure pesticide use in simple quantity units (kilogram per hectare)compared to the quality and intensity corrected Load Index. This means for example, that farmers will ceteris paribus use lower quantities of herbicides, but will increase the overall toxicity of the products applied with increasing risk aversion. We discuss implications of our findings for the design of pesticide policies and agricultural risk management instruments.
“…Another option is the introduction of taxation schemes that raise the relative price of nitrogen compared to its production value 41,42 . There are also other possibilities for countries to support the adoption of new, more sustainable technologies and farming practices, e.g.…”
National institutions and policies could provide powerful levers to steer the global food system towards higher agricultural production and lower environmental impact. However, causal evidence of countries' influence is scarce. Using global geospatial datasets and a regression discontinuity design, we provide causal quantifications how much crop yield gaps, nitrogen pollution, and nitrogen pollution per crop yield, are influenced by country-level factors, such as institutions and policies. We find that countries influence nitrogen pollution much more than crop yields and there is only a small trade-off between reducing nitrogen pollution and increasing yields. Overall, countries that cause 35% less nitrogen pollution than their neighbors only cause a 1 percent larger yield gap (the difference between attainable and attained yield). Explanations which countries cause the most pollution relative to their crop yields include economic development, population size, institutional quality, foreign financial flows to land resources, as well as countries' overall agricultural intensity and its share in the economy. Our findings suggest that many national governments have an impressive capacity to reduce global nitrogen pollution without having to sacrifice much agricultural production.
MainThe global food system is at the epicenter of many of this century's greatest challenges 1-4 . To match growing demand, crop production will need to increase 25-70% from 2015 to 2050 [4][5][6][7] . Because natural
“…Nitrogen fertilizer taxation has been found to be an effective policy in Austria, Finland, and Sweden (Rougoor et al, 2001). Finger (2012) shows that a nitrogen fertilizer tax would be the more effective the higher farmers' risk aversion. Although fertilizer use in developing countries is rather low compared to developed countries in absolute terms, it grows at a significantly faster rate: The average yearly growth rate of nitrogen use between 2000 and 2018 has been seven times higher in Least Developed Countries compared to the European Union and two to three times higher compared to the United States (FAO, 2021).…”
We model a stylized economy dependent on agriculture and fisheries to study optimal environmental policy in the face of interacting external effects of ocean acidification, global warming, and eutrophication. This allows us to capture some of the latest insights from research on ocean acidification. Using a static two‐sector general equilibrium model we derive optimal rules for national taxes on
CO
2 emissions and agricultural run‐off and show how they depend on both isolated and interacting damage effects. In addition, we derive a second‐best rule for a tax on agricultural run‐off of fertilizers for the realistic case that effective internalization of
CO
2 externalities is lacking. The results contribute to a better understanding of the social costs of ocean acidification in coastal economies when there is interaction with other environmental stressors.
Recommendations for Resource Managers:
Marginal environmental damages from
CO
2 emissions should be internalized by a tax on
CO
2 emissions that is high enough to not only reflect marginal damages from temperature increases, but also marginal damages from ocean acidification and the interaction of both with regional sources of acidification like nutrient run‐off from agriculture.
In the absence of serious national policies that fully internalize externalities, a sufficiently high tax on regional nutrient run‐off of fertilizers used in agricultural production can limit not only marginal environmental damages from nutrient run‐off but also account for unregulated carbon emissions.
Putting such regional policies in place that consider multiple important drivers of environmental change will be of particular importance for developing coastal economies that are likely to suffer the most from ocean acidification.
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