AN EMPIRICAL-ANALYSIS OF THE RELATIVE EFFICIENCY OF POLICY INSTRUMENTS TO REDUCE NITRATE WATER-POLLUTION IN THE US SOUTHERN HIGH-PLAINS

This paper develops a modeling framework for evaluating alternative wa ter quality protection policies. The framework integrates the EPIC-PST crop growth/chemical transport model and a mathematical programming m odel. The framework is applied to the evaluation of four water quality policies in the southern high plains of the United States: restrictio ns on per-acre nitrogen use, taxes on nitrogen use, taxes on irrigatio n water use, and incentives to convert conventional irrigation systems to modern irrigation technology. The results indicate that producers would make a variety of adjustments in responding to these policies. I mportant responses might include reductions in nitrogen and water use, crop substitution, removal of land from crop production and conversio n from irrigated to dryland production. These four policies are evalua ted based on changes in farm income and social welfare. The irrigation system conversion incentive clearly outperforms other policies from b oth society's and producers' points of view. Producers would prefer ni trogen use restrictions to nitrogen or water use tares because farm in come would be reduced less under the restrictions than under the taxes . Nitrogen use tares, however, are more desirable than nitrogen use re strictions from society's point of view.