Agriculture Reference
In-Depth Information
cropping practices reflects not just farm heterogeneity due to differences in land
and equipment, but also farmer heterogeneity due to differences in attitudes and
management ability.
Two general patterns emerged from the supply response analysis. First, farm-
ers were willing to supply much more land for System A, the simplest cropping
system, than for the three systems that involved cover crops or more complicated
management (Ma et al. 2012). In economic terms, this greater price elasticity of
supply meant that for a given increase in payment, farmers would offer to devote
more land to System A than to the other cropping systems. Second, farmers with
over 500 acres (202 ha) were much more willing than operators of smaller farms
to respond to higher payments by offering more acreage, especially for System D
(Jolejole 2009). It was evident that these larger farms are the low-cost suppliers of
environmental services. So payment-for-environmental-services policies that aim
for cost-effective gains will likely achieve most of their impact from larger farms.
For measuring the economic value of
individual
ecosystem services from agri-
culture, the analysis was indeterminate for an important reason: management deci-
sions affect multiple ecosystem services simultaneously. Put colloquially, ecosystem
services come in bundles. A given agroecosystem generates ecosystem services in
relatively fixed proportions (Antle and Capalbo 2002, Wossink and Swinton 2007).
There exists no sound method for allocating costs among the different system out-
puts without an understanding of consumer demand for them.
Consumer Demand for Land-Based Ecosystem Services
How do consumers value the kinds of ecosystem services that farmers can help
to produce? The answer to that question can inform the demand side of economic
valuation for these services.
Few consumers perceive ecosystem services as scientists do. Ecosystem ser-
vices like climate regulation, water quality regulation, nutrient cycling, and pest
population regulation are meaningful to ecologists, but opaque to the general pub-
lic. As a first step before designing a consumer survey, Chen (2010) developed a
graphical model of how agricultural practices generate intermediate environmen-
tal changes that lead to the ecosystem services experienced by the general public
(Fig. 3.4). To highlight one set of relationships in the figure, crop fertilization and
tillage and their effects on nutrient cycling may carry little meaning for most citi-
zens. But when lakes become eutrophic as a result of excess nutrients, the meaning
to recreational users is very clear.
Based on the literature and pretests of the questionnaire, KBS LTER economists
focused on two high-profile endpoints: the proportion of eutrophic lakes and per-
centage of progress toward international goals for abatement of climate change. The
survey population were all residents of the state of Michigan. The 2009 Michigan
Environmental Survey went to 6000 Michigan households stratified by population
in each county to cover the full geographic extent of the state; the final response
rate was 41% (Chen 2010). Respondents were first presented with information
about climate change and eutrophication of lakes, along with the links between
land management practices and changes in those outcomes. Householders were
