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Abstract
Simulated crop growth and nonpoint pollution yields under stochastic weather conditions
generated farmers' expected net returns and the environmental effects of implementing 'Best Management
Practices' (BMPs) under risky and uncertain conditions. Results from varying nitrogen fertilizer and
irrigation management levels over a growing season show that, for production-optimal levels of nitrogen
fertilization and irrigation without regard to pollution, nitrogen leaching is more serious, but soil loss and
nitrogen runoff are lower, than for other scenarios tested. Voluntary implementation of BMPs to reduce
levels of inputs and decrease water quality impacts would require substantial cost-sharing incentives.
Farmers favour a cost-sharing program, with 87 percent willing to participate when government's costshare
is at the 80 percent level. When tight budgets restrict implementation of stricter pollution targets, a
20 percent cost-sharing would induce 27 percent of the farmers surveyed to voluntarily select BMPs.