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Simulation of a Group Incentive Program for Farmer Adoption of Best Management Practices

Published online by Cambridge University Press:  15 September 2016

Viju C. Ipe ,
Eric A. DeVuyst ,
John B. Braden  and
David C. White
Viju C. Ipe
Affiliation:
Department of Agricultural Economics at North Dakota State University
Eric A. DeVuyst
Affiliation:
Department of Agricultural Economics at North Dakota State University
John B. Braden
Affiliation:
University of Illinois at Urbana-Champaign
David C. White
Affiliation:
Department of Agricultural and Consumer Economics at the University of Illinois at Urbana-Champaign
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Abstract

A group incentive program to encourage farmer adoption of best management practices is simulated for a typical watershed in central Illinois. The incentive payments, program costs and environmental impacts of the program are simulated. The results show that the best management practices may not actually reduce farm profits but may increase farm profits and reduce environmental pollution. The sponsor in most cases may not have to pay anything under the incentive contract. This may bring about a win-win situation for the sponsor, the farmer participating in the program, and society as a whole. The program could be implemented as an educational effort to demonstrate the benefits of sound management practices.

Type
Articles
Information
Agricultural and Resource Economics Review , Volume 30 , Issue 2 , October 2001 , pp. 139 - 150
Copyright
Copyright © 2001 Northeastern Agricultural and Resource Economics Association 

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