QUALITY-ADJUSTED PRICE AND QUANTITY INDEXES FOR PESTICIDES

Quality-adjusted price indices are calculated for pesticides used on m ajor crops in U.S. agriculture for 1967-92 using hedonic methods. Pest icide potency, hazardous characteristics, and persistence in the envir onment are used as quality characteristics. Separate hedonic functions are estimated for pesticides by end-use (crop) and major pesticide cl ass. Price indices are aggregated using chained Tornqvist indices. Adj usted quantity indices are computed using pesticide expenditures. The adjusted price index rose steadily, reaching in 1992 around 2.5 times the level of 1968. Pesticide use at constant quality peaked in 1981 at a level substantially higher than the peak reached by the unadjusted index.