Economic and environmental impacts of water quality protection policies: 2. Application to the Central High Plains

Abstract

A three‐stage modeling framework is applied to evaluate the potential economic and environmental impacts of agricultural groundwater protection policies in the Central High Plains Region. Three alternative policies (limitations on total nitrogen applications, limitations on unit‐area nitrogen applications, and restrictions on the use of selected herbicides) are compared to a baseline scenario that reflects the absence of any form of groundwater quality protection measures. In general, nitrogen restrictions are more effective in reducing nitrate loadings in percolation water if implemented on a unit‐area basis rather than as a total (farm level) restriction. In contrast, the total restriction is more effective in controlling runoff losses of nitrogen. Both nitrogen restrictions have significant impacts on crop production levels and regional agricultural income, while the economic consequences of the pesticide restriction are much less pronounced. The proposed regional modeling framework provides critical information necessary to assess the economic and environmental tradeoffs of policy alternatives aimed at controlling agricultural nonpoint source pollution.