Potential Conflict and Inefficiencies Arising in Agri‐environmental Management

Abstract

ACL-3International audienceWe characterise the welfare implications of uncoordinated policy decisions in the presence of multiple externalities, illustrated with an aquifer. We concentrate on the problem of coordination that can occur when distinct agricultural and water authorities implement their respective policies (to optimise food production and groundwater use) with environmental concerns in mind. We represent this problem as an open-loop Nash game, which compares the game-theoretical solution to a centrally planned solution. We show that the inefficiencies arise from differences in the account taken of relevant costs by different authorities. We demonstrate that the magnitude of the inefficiency generated by the absence of coordination of our authorities varies depending on the weights put on environmental benefits by each authority, and discuss the implications of analysis for future research and policy

Optimal Regional Regulation of Animal Waste

“…The results are also related to the game theoretical model of Martin and Stahn (2013) who illustrate a conflict between agricultural and ground water managers, drawing from their differing definitions of externalities. And even though we have not analyzed policy instruments so far, the results also hint towards the Tinbergen rule (Tinbergen, 1952) which states that economic policy must include as many instruments as targets.…”

Bringing together social-ecological system and territoire concepts to explore nature-society dynamics

“…Economics has pointed out the existence of externalities due to material flows that are not managed (e.g., nonpoint source pollution due to heavy use of pesticides and fertilizers in agriculture). Current governance systems are challenged in accounting for these externalities because of a lack of valuation systems and institutions to handle them (Sarker et al 2008, Martin andStahn 2013). Adding an extensive flow analysis, including the agency involved in these flows, should better inform these governance processes.…”