Previous studies on the environmental impacts of pesticide use have tended to focus either on measuring damages through changes in relative risks to various environmental categories or examining the trade-off between pesticide use levels and abatement costs. This study uses the physical risk assessment approach combined with contingent valuation survey results on consumers' willingness to reduce pesticide risk. The reduction in external costs associated with the changes in pesticide use in Ontario agriculture between 1983 and 1998 is US$ 188 per household. The environmental benefits are largely due to the reduction in the level of high and moderate-risk pesticides. © 2001 Elsevier Science B.V. All rights reserved.