Abstract
Effective management of nitrogen (N) fertilizer is central to enhancing agricultural productivity, while improving water and air quality and mitigating climate change. Quantifying “socially optimal” rates of N fertilizer (i.e. maximizing net benefits to society while minimizing social costs) is a key component of any regulatory or incentive program designed to better manage N application. Here, we estimate spatially-explicit socially optimal N fertilizer application rates for corn in Minnesota that account for uncertainty, both in valuation techniques and model parameters. We find that socially optimal rates of N fertilizer application are between 0 and 161 kg ha−1, whereas the private optimum is 165 kg ha−1. Choice of valuation methods shifts the spatial configuration and magnitude of the socially optimal N application rates illustrating the importance of valuation method and assumptions. Even after accounting for uncertainty in valuation methods, we find reducing rates of N fertilizer application offers significant opportunities to improve social welfare. By internalizing the social costs of nitrogen, net social benefits of N could increase by over $1100 ha−1, even while accounting for declines in agricultural yields.
Original language | English (US) |
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Pages (from-to) | 292-299 |
Number of pages | 8 |
Journal | Agriculture, Ecosystems and Environment |
Volume | 254 |
DOIs | |
State | Published - Feb 15 2018 |
Bibliographical note
Publisher Copyright:© 2017 Elsevier B.V.
Keywords
- Air quality
- Cost-benefit analysis
- Nitrogen
- Non-market valuation
- Uncertainty
- Water quality