|University of California – Riverside
|Environmental economics; Natural resource management; animal waste; dynamic optimization; groundwater; nitrate; policy instrument; pollution control
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Animal waste from animal feeding operations (AFOs) is a significant contributor to nitrate contamination of groundwater. Some animal waste also contains heavy metals and salts that may build up in cropland and underlying aquifers. This thesis focuses on pollution reduction from the largest AFOs, in particular, Concentrated Animal Feeding Operations (CAFOs), which present the greatest potential risk among all AFOs to environmental quality and public health. To find cost-effective policies for controlling pollution at the field level and at the farm level, a dynamic environmental-economic modeling framework for representative CAFOs is developed. The framework incorporates four models (i.e., animal model, crop model, hydrologic model, and economic model) that includes various components such as herd management, manure handling system, crop rotation, water sources, irrigation system, waste disposal options, and pollutant emissions. The operator maximizes discounted total farm profit over multiple periods subject to environmental regulations. Decision rules from the dynamic optimization problem demonstrate best management practices for CAFOs to improve their economic and environmental performance. Results from policy simulations suggest that direct quantity restrictions of emission or incentive-based emission policies are much more cost-effective than the standard approach of limiting the amount of animal waste that may be applied to fields; reason being, policies targeting intermediate pollution and final pollution create incentives for the operator to examine the effects of other management practices to reduce pollution in addition to controlling the polluting inputs. Incentive-based emission policies are shown to have advantages over quantity restrictions over multiple years when seasonal or annual emissions fluctuate either due to inherent operation practices or the accumulation of precursors to the pollution. My approach demonstrates the importance of taking into account the integrated effects of water, nitrogen, and salinity on crop yield and nitrate leaching as well as the spatial heterogeneity of nitrogen/water application. It also suggests that ecosystem services can play an important role in pollution control and thus deserve more attention when designing policies.