Agriculture Reference
In-Depth Information
programs for water pollution and GHG emissions have failed to gain traction
because they lack legally binding caps on emissions needed to motivate signifi-
cant payment rates.
Taxes on polluting inputs are another incentive avenue. Agrochemical input
taxes have been implemented at low levels in many U.S. states. While these taxes
generate revenues often directed toward financing more environmental improve-
ments, they have not led to widespread adoption of reduced agrochemical use. The
literature suggests that tax rates would have to be very high in order to trigger
significant reductions in agrochemical application rates (Swinton and Clark 1994,
Claassen and Horan 2001, Ribaudo et al. 2011).
The adoption of environmental stewardship practices can also be made a pre-
condition for farmers to gain access to desirable opportunities. In the government
sector, conservation compliance is already required for farmers to access many
farm subsidy programs, and those requirements could be expanded (Ribaudo et al.
2011). In the private sector, a number of large food companies have mandated cer-
tain management practices in the name of corporate social responsibility (Maloni
and Brown 2006). For example, McDonald's requires that contracted poultry farm-
ers meet certain animal welfare requirements. By making market access contingent
on the adoption of environmental practices, the incentive for farmer adoption is tied
to the value of being in that market.
To put this recent incentive research into a broader perspective, U.S. farmer
attitudes and adoption behavior emerge from a legal institutional setting under
which farmers have broad latitude to use their land, so long as there is no directly
traceable harm done to someone else. This U.S. legal precedent evolved from
English common law during a time when no scientific basis existed to dem-
onstrate links between farm input use and outcomes that were unimaginable
at that time, such as hypoxia in the Gulf of Mexico or changes in the global
climate. Even when those links are acknowledged, the nonpoint source nature
of much agricultural pollution impedes tracing outcomes to individual sources.
Moreover, much of the damage from agricultural pollution results from the
combined effect of individual contributions, making it difficult to tie aggregate
impacts to individual actions.
Property rights hinge on the relationship between the person and the property.
The judicial interpretation of that relationship has evolved over time (Williams
1998, Merrill and Smith 2001). Mainly in nonagricultural settings has it come to
provide greater protection for the interests of persons other than the property owner.
Nuisance law does recognize certain property rights of neighbors, but the law has
yet to recognize the attenuation of agricultural property rights based on nonpoint
source pollution. This matters both to decisions about agricultural production prac-
tices and to resultant environmental quality.
The assignment of property rights affects the very definition of production
costs (Coase 1960, Norris et al. 2008, Schmid 2004). Because most U.S. farmers
hold the implicit right to allow excess nutrients and greenhouse gases to move
into off-farm water and air, they expect to be compensated for internalizing
these disposal costs. This definition of property rights is coming under challenge
from a view based on relations among members of society (Singer 2000). Kling
