Regulation of Nitrogen Pollution: Taxes versus Quotas
This paper investigates the effects of first-best policies to regulate nitrogen application. Some nitrogen fertilizer is applied ex ante before a random rainfall, but side-dressed nitrogen may be applied ex post. First-best policy is a tax or a quota on ex ante application, because side-dressed nitr...
| Main Authors: | , |
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| Format: | Article |
| Language: | English |
| Published: |
Western Agricultural Economics Association
1995-07-01
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| Series: | Journal of Agricultural and Resource Economics |
| Subjects: | |
| Online Access: | https://ageconsearch.umn.edu/record/30925 |
| _version_ | 1828292267533664256 |
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| author | E. Kwan Choi Eli Feinerman |
| author_facet | E. Kwan Choi Eli Feinerman |
| author_sort | E. Kwan Choi |
| collection | DOAJ |
| description | This paper investigates the effects of first-best policies to regulate nitrogen application. Some nitrogen fertilizer is applied ex ante before a random rainfall, but side-dressed nitrogen may be applied ex post. First-best policy is a tax or a quota on ex ante application, because side-dressed nitrogen is not leached. Since a risk-averse farmer uses more nitrogen ex ante than a risk-neutral farmer, a higher tax must be imposed on the former. Action equivalent first-best taxes and quotas are also welfare equivalent. An empirical model for wheat in Israel was used to demonstrate the analytical findings. |
| first_indexed | 2024-04-13T11:05:48Z |
| format | Article |
| id | doaj.art-a68229a93fd445e8bc954c8f8d331eb1 |
| institution | Directory Open Access Journal |
| issn | 1068-5502 2327-8285 |
| language | English |
| last_indexed | 2024-04-13T11:05:48Z |
| publishDate | 1995-07-01 |
| publisher | Western Agricultural Economics Association |
| record_format | Article |
| series | Journal of Agricultural and Resource Economics |
| spelling | doaj.art-a68229a93fd445e8bc954c8f8d331eb12022-12-22T02:49:17ZengWestern Agricultural Economics AssociationJournal of Agricultural and Resource Economics1068-55022327-82851995-07-0120112214310.22004/ag.econ.3092530925Regulation of Nitrogen Pollution: Taxes versus QuotasE. Kwan ChoiEli FeinermanThis paper investigates the effects of first-best policies to regulate nitrogen application. Some nitrogen fertilizer is applied ex ante before a random rainfall, but side-dressed nitrogen may be applied ex post. First-best policy is a tax or a quota on ex ante application, because side-dressed nitrogen is not leached. Since a risk-averse farmer uses more nitrogen ex ante than a risk-neutral farmer, a higher tax must be imposed on the former. Action equivalent first-best taxes and quotas are also welfare equivalent. An empirical model for wheat in Israel was used to demonstrate the analytical findings.https://ageconsearch.umn.edu/record/30925first-best policyquotastaxes |
| spellingShingle | E. Kwan Choi Eli Feinerman Regulation of Nitrogen Pollution: Taxes versus Quotas Journal of Agricultural and Resource Economics first-best policy quotas taxes |
| title | Regulation of Nitrogen Pollution: Taxes versus Quotas |
| title_full | Regulation of Nitrogen Pollution: Taxes versus Quotas |
| title_fullStr | Regulation of Nitrogen Pollution: Taxes versus Quotas |
| title_full_unstemmed | Regulation of Nitrogen Pollution: Taxes versus Quotas |
| title_short | Regulation of Nitrogen Pollution: Taxes versus Quotas |
| title_sort | regulation of nitrogen pollution taxes versus quotas |
| topic | first-best policy quotas taxes |
| url | https://ageconsearch.umn.edu/record/30925 |
| work_keys_str_mv | AT ekwanchoi regulationofnitrogenpollutiontaxesversusquotas AT elifeinerman regulationofnitrogenpollutiontaxesversusquotas |