Paying Farmers to Reduce Nitrogen Application on Corn: The Baseline Approach

We model a simulated green-payment policy to reduce nitrogen application on corn. In contrast to other papers, we recognize that the farm’s business-as-usual application rate cannot be known by the policymaker. We develop a structural model and data-driven approach to address this issue. We find that only one-third of the credits that would receive payments would be additional nitrogen reductions. The substantial volume of non-additional “reductions” leads the effective payment rate to be 3.5 times the price paid by the simulated policy. We discuss a further eligibility criterion that can improve policy performance.


Issue Date:
2013
Publication Type:
Conference Paper/ Presentation
PURL Identifier:
http://purl.umn.edu/150561
Total Pages:
39




 Record created 2017-08-04, last modified 2017-08-27

Fulltext:
Download fulltext
PDF

Rate this document:

Rate this document:
1
2
3
 
(Not yet reviewed)