THE ECONOMICS OF A PUBLIC FUND FOR ENVIRONMENTAL AMENITIES - A STUDY OF CRP CONTRACTS

The problem of targeting CRP purchases to buy environmental amenities under productivity and environmental heterogeneity is considered. Gini coefficients and Lorenz curves are used to measure the effectiveness of spending under alternative targeting criteria. The environmental be nefits considered are water erosion, wind erosion, surface water quali ty, and wildlife habitat. The three alternative targeting criteria exa mined include purchasing land according to ii) the benefit-to-cost rat io, (ii) the level of benefits, and (iii) the level of cost; Results i ndicate that the degree of variability and correlation determine the e xtent to which suboptimal targeting achieves a significant portion of available environmental benefits.