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Watershed-Scale Economic and Environmental Tradeoffs Incorporating Risks: A Target MOTAD Approach

Published online by Cambridge University Press:  15 September 2016

Zeyuan Qiu ,
Tony Prato  and
Michael Kaylen
Zeyuan Qiu
Affiliation:
Department of Agricultural Economics, University of Missouri-Columbia
Tony Prato
Affiliation:
Department of Agricultural Economics, University of Missouri-Columbia
Michael Kaylen
Affiliation:
Department of Agricultural Economics, University of Missouri-Columbia
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Abstract

This paper evaluates the economic and environmental tradeoffs at watershed scale by incorporating both economic and environmental risks in agricultural production. The Target MOTAD model is modified by imposing a probability-constrained objective function to capture the yield uncertainty caused by random allocation of farming systems to soil types and by introducing environmental targets to incorporate environmental risk due to random storm events. This framework is used to determine the tradeoff frontier between watershed net return and sediment yield and nitrogen concentration in runoff in Goodwater Creek watershed, Missouri. The frontier is significantly affected by environmental risk preference.

Type
Articles
Information
Agricultural and Resource Economics Review , Volume 27 , Issue 2 , October 1998 , pp. 231 - 240
Copyright
Copyright © 1998 Northeastern Agricultural and Resource Economics Association 

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