Assessment of Economic and Water Quality Impacts of Land Use Change Using a Simple Bioeconomic Model

The objective of this study is to assess the economic and water quality impact of land use change in a small watershed in the Wiregrass region of Alabama. The study compares changes in water quality and revenue from agricultural and timber production due to changes in land use between years 1992 and 2001. The study was completed in two stages. In the first stage, a biophysical model was used to estimate the effect of land use change on nitrogen and phosphorus runoff and sediment deposition in the main channel; in the second stage, farm enterprise budgeting tools were used to estimate the economic returns for the changes in land use condition. Both biophysical and economic results are discussed, and a case for complex optimization to develop a decision support system is presented.     

OPTIMAL PROFITS UNDER ENVIRONMENTAL CONSTRAINTS: IMPLICATIONS OF NUTRIENT AND SEDIMENT STANDARDS1

To reduce nonpoint source pollution from nutrient, chemical, and sediment runoff, a number of environmental policy standards have been proposed. Such standards could be used to reduce nonpoint source pollution from nutrient, chemical, and sediment runoff to impaired water bodies. State governments can use voluntary approaches to meet nonpoint source pollution reduction goals. However, the practices that lower net returns will not be voluntarily adopted by farmers. Crop rotations and tillage practices may help producers to comply with the environmental standards while minimizing losses in farm profits. This study compares runoff from crop rotation practices and conventional continuous row cropping systems in Mississippi. The results are compared for different tillage systems in order to examine robustness of results. Nutrient runoff and sediment runoff are simulated using the Erosion Productivity Impact Calculator (EPIC). Sensitivity analysis of the sediment and nitrate reductions at 15 percent, 25 percent, and 35 percent are conducted. Under these scenarios, net returns are optimized under environmental constraints, and the marginal cost of sediment reduction ranges from US$1.61 to US$9.63 per ton depending on soil conditions, while the corresponding nitrate and phosphorus reductions costs range from US$1.21 to US$7.08 per kg and from US$0.09 to US$31.91, respectively. The empirical results from this study indicate that a nitrate reduction policy is relatively less costly than a sediment reduction policy. The results also demonstrate the importance of geophysical conditions and policy costs, which vary across regions.     

Environmental regulation through trade: the case of shrimp

The implications of a potential ban on shrimp imports by the US from countries that do not utilize the Turtle Excluder Device on commercial shrimp nets is explored in this paper. A Linear Expenditure System (LES) was used to determine the own-price elasticities of demand for shrimp imports. The system of estimated equations was then solved for quantity levels under assumptions made about the trade restrictions, resulting in a set of prices for those import levels. These estimated prices were then used to estimate the compensating variation impact of the trade restrictions. Findings suggest that the environmental regulation would have a negative impact on US consumers, but the magnitude of that effect depends on assumptions made regarding the distribution of US imports after the trade restriction is imposed.     

A Stream–Wetland–Riparian (SWR) index for assessing condition of aquatic ecosystems in small watersheds along the Atlantic slope of the eastern U.S.

As part of a regional study by the Atlantic Slope Consortium (ASC) to develop ecological and socioeconomic indicators of aquatic ecosystem condition, we developed and tested a protocol for rapidly assessing condition of the stream, wetland, and riparian components of freshwater aquatic ecosystems. Aspects of hydrology, vegetation, in-stream and wetland characteristics, and on-site stressors were measured in the field. The resulting metrics were used to develop an index of overall condition, termed the Stream–Wetland–Riparian (SWR) Index. Values of this Index were compared to existing biotic indices and chemical measures, and to a Landscape Index created using satellite-based land cover data and a geographic information system (GIS). Comparisons were made at several levels of spatial aggregation and resolution, from site to small watershed. The SWR Index and associated Landscape Indices were shown to correlate highly with biological indicators of stream condition at the site level and for small contributing areas. The landscape patterns prevalent throughout the entire watershed do not necessarily match the patterns found adjacent to the stream network. We suggest a top-down approach that managers can use to sequentially apply these methods, to first prioritize watersheds based on a relative condition measure provided by the Landscape Index, and then assess condition and diagnose stressors of aquatic resources at the subwatershed and site level.