This article investigates farmers’ willingness to participate in the best management practices (BMPs) through a proposed Water Quality Trading (WQT) program in Kentucky. This analysis includes two parts; the first part is to investigate the factors influencing farmers’ current usage of BMPs; the second part is to estimate farmers’ willingness to implement BMPs given different levels of compensation proposed through a survey. The results show that farmers who participate in conservation programs from the USDA are more likely to use BMPs, but these farmers may not accept the offer to implement additional BMPs. Farmers’ perceptions about BMPs are more likely to convince them to adopt additional BMPs than the amount of compensation/cost-share offered through WQT. The results also find that the probabilities of fencing off animals and building up waste storage facility are positively correlated with the levels of compensation.


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