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GTAP Resource #1849

"Pesticide Reducing Instruments – An Interdisciplinary Analysis of effectiveness and optimality"
by Jacobsen, Lars-Bo, Jørgen D. Jensen, Martin Andersen, Thomas Bjørner, Jens Hauch and Cris J. Topping

For decades the concerns about the impact of modern agriculture’s use of pesticides have been one of the most debated issues within Danish environmental politics. Several action plans have aimed at reducing the use of pesticides, but the scientific basis of these has not been well justified. The aim of this paper is to analyze the effectiveness of different instruments targeting unilateral pesticide reductions in Danish agriculture as well as whether the benefit from further reductions exceeds the social costs. The last issue is a novel feature of this paper since it requires the collaboration and linkage of very different research disciplines and modeling tools.

In the paper we combine several analytical tools in search of an effective pesticide instrument and an optimal application of such an instrument. The tools under considerations are firstly a CGE model used for evaluating the cost and to calculate general economic and sectoral consequences. This CGE model is linked to an agricultural sector model calculating the optimal use of land, and the agricultural sector model is then linked to a biological agent based simulation model (ABM) calculating changes in the population of a key species of farmland bird, caused to changes in production and landscape. The results from the agricultural sector model are also used in evaluation of pesticide usage and the leaching of pesticides to ground water.

First we analyze the implication of three different scenarios in all of the above-mentioned models and tools. All three scenarios are constructed such that they result in the same welfare implication (measured by national consumption in the CGE model). The scenarios are: 1) pesticide taxes resulting in a 25 percent overall reduction; 2) use of unsprayed field margins, resulting in the same welfare loss as in scenario 1; and finally 3) increased conversion to organic farming also resulting in the same welfare loss as in scenario 1.

Biological and geological results from the first part of our analysis suggest that the use of unsprayed field margins is the most cost-effective instrument for improving bio-diversity and securing drinking water. That is, combining economic modeling with physical biological modeling and geological evaluation allows us to select unsprayed field margins as the most effective instrument. Sensitivity analysis conducted on bio-diversity suggest that this result is globally stable

Having concluded that unsprayed field margins are the most effective instrument, we proceed by including valuation studies of increased bio-diversity which allows us to estimate the total value of increased biodiversity in the field margins scenario and thus contributes to an actual cost-benefit analysis. But further more we also address the question of the optimal size of field margins. Combining the valuation studies, with a series of analysis from both the biodiversity model (ABM) and the CGE model enables us to obtain the total abatement cost and benefit curves. From these curves we can then deduce the marginal benefit and cost curves, which allow us to determine the optimal size of unsprayed field margins.

Resource Details (Export Citation) GTAP Keywords
Category: GTAP Application
2005 Conference Paper
Status: Published
By/In: Presented at the 8th Annual Conference on Global Economic Analysis, Lübeck, Germany
Date: 2005
Version: 0.1
Created: Jacobsen, L. (6/8/2005)
Updated: Batta, G. (6/21/2005)
Visits: 1,768
No keywords have been specified.

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