IDEAS home Printed from https://ideas.repec.org/p/ags/uqseee/55105.html
   My bibliography  Save this paper

Policy Choices about Agricultural Externalities and Sustainability: Diverse Approaches, Options and Issues

Author

Listed:
  • Tisdell, Clement A.

Abstract

This paper reviews agricultural externalities as a source of market failure and as a reason for a lack of sustainability of agricultural incomes and production. It concentrates mainly on environmental externalities (which include biodiversity loss) but consideration is also given to externalities involving adverse selection. Types of agricultural externalities are classified and their nature is explored. Depending on their type and nature, different policy implications often follow. For example, no intervention may be required, or it may be reasonable for a farmer to have to pay to create an unfavourable externality or be paid to moderate or eliminate it. Adverse selection is also an externality phenomenon and some of its implications for agricultural policy are explored. Traditionally, environmental economics has focused on economic efficiency in formulating policies for environmental regulation but equity is also important in relation to public policy. The implications of various equity principles for designing policies to address the occurrence of agricultural externalities are outlined. Attention is subsequently centered on the economic practicality of agricultural environmental policies when account is taken of transaction costs and knowledge limitations, as well as the political and social acceptability of such policies. These factors can alter the choice of ideal policies. Biodiversity change (conservation and loss) involving agriculture is considered as a particular case. By showing the relevance for agricultural policy of diverse foci, this study accords with the polycentric approach of Konrad Hagedorn. His approach should make us wary of cut-and-dried specific but narrow policy solutions that characterise traditional environmental economics. The "exactitude" of these solutions appears in many cases to be obtained at the expense of relevance.

Suggested Citation

  • Tisdell, Clement A., 2007. "Policy Choices about Agricultural Externalities and Sustainability: Diverse Approaches, Options and Issues," Economics, Ecology and Environment Working Papers 55105, University of Queensland, School of Economics.
    • Handle: RePEc:ags:uqseee:55105
    DOI: 10.22004/ag.econ.55105
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/55105/files/WP146.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.22004/ag.econ.55105?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    --->

    References listed on IDEAS

    as
    1. Clement A. Tisdell, 2005. "Economics of Environmental Conservation, Second Edition," Books, Edward Elgar Publishing, number 3272, December.
    2. R. H. Coase, 2013. "The Problem of Social Cost," Journal of Law and Economics, University of Chicago Press, vol. 56(4), pages 837-877.
    3. Knetsch, Jack L., 1990. "Environmental policy implications of disparities between willingness to pay and compensation demanded measures of values," Journal of Environmental Economics and Management, Elsevier, vol. 18(3), pages 227-237, May.
    4. Daniel Kahneman & Jack L. Knetsch & Richard H. Thaler, 1991. "Anomalies: The Endowment Effect, Loss Aversion, and Status Quo Bias," Journal of Economic Perspectives, American Economic Association, vol. 5(1), pages 193-206, Winter.
    5. George A. Akerlof, 1970. "The Market for "Lemons": Quality Uncertainty and the Market Mechanism," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 84(3), pages 488-500.
    6. Konrad Hagedorn, 1993. "Institutions and Agricultural Economics," Journal of Economic Issues, Taylor & Francis Journals, vol. 27(3), pages 849-886, September.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. de Groot, I. Manon & Antonides, Gerrit & Read, Daniel & Raaij, W. Fred van, 2009. "The effects of direct experience on consumer product evaluation," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 38(3), pages 509-518, June.
    2. Franziska Rischkowsky & Thomas Döring, 2008. "Consumer Policy in a Market Economy Considerations from the Perspective of the Economics of Information, the New Institutional Economics as well as Behavioural Economics," Journal of Consumer Policy, Springer, vol. 31(3), pages 285-313, September.
    3. Mason, Susan G. & Holley, Don & Wells, Aaron & Jain, Amit & Wuerzer, Thomas & Joshi, Alark, 2016. "An experiment-based methodology to understand the dynamics of group decision making," Socio-Economic Planning Sciences, Elsevier, vol. 56(C), pages 14-26.
    4. Gerald Spindler, 2011. "Behavioural Finance and Investor Protection Regulations," Journal of Consumer Policy, Springer, vol. 34(3), pages 315-336, September.
    5. Tisdell, Clement A., 2007. "Institutional Economics and the Behaviour of Conservation Organizations: Implications for Biodiversity Conservation," Economics, Ecology and Environment Working Papers 55099, University of Queensland, School of Economics.
    6. Xingrong Hou & Jianmin Zeng & Hong Chen & Li Su, 2019. "The endowment effect in the genes: An exploratory study," Judgment and Decision Making, Society for Judgment and Decision Making, vol. 14(3), pages 293-298, May.
    7. Todorova, Tamara, 2015. "The Transaction-Cost Roots of Market Failure," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 0(1(11)), pages 30-44.
    8. Scott Duke Kominers & Alexander Teytelboym & Vincent P Crawford, 2017. "An invitation to market design," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 33(4), pages 541-571.
    9. Élodie Bertrand, 2006. "La thèse d'efficience du « théorème de Coase ». Quelle critique de la microéconomie ?," Revue économique, Presses de Sciences-Po, vol. 57(5), pages 983-1007.
    10. Marco FRIGERIO & Daniela VANDONE, 2018. "Virtuous or Vicious? Development Banks in Europe," Departmental Working Papers 2018-07, Department of Economics, Management and Quantitative Methods at Università degli Studi di Milano.
    11. Eduard Marinov, 2017. "The 2017 Nobel Prize in Economics," Economic Thought journal, Bulgarian Academy of Sciences - Economic Research Institute, issue 6, pages 117-159.
    12. Danstun B. Ngonyani & Harun J. Mapesa, 2019. "Implication of Credit Supervision Practices on Portfolio at risk of Microfinance Institutions in Tanzania," Journal of Economics and Financial Analysis, Tripal Publishing House, vol. 3(1), pages 27-45.
    13. Nobel Prize Committee, 2017. "Richard H. Thaler: Integrating Economics with Psychology," Nobel Prize in Economics documents 2017-1, Nobel Prize Committee.
    14. Wiser, R. H., 2000. "The role of public policy in emerging green power markets: an analysis of marketer preferences," Renewable and Sustainable Energy Reviews, Elsevier, vol. 4(2), pages 177-212, June.
    15. Sadok El Ghoul & Omrane Guedhami & Yongtae Kim, 2017. "Country-level institutions, firm value, and the role of corporate social responsibility initiatives," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 48(3), pages 360-385, April.
    16. Budzinski, Oliver & Haucap, Justus, 2019. "Kartellrecht und Ökonomik: Institutions matter!," DICE Ordnungspolitische Perspektiven 102, Heinrich Heine University Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
    17. Philippe Jehiel & Ady Pauzner, 2006. "Partnership dissolution with interdependent values," RAND Journal of Economics, RAND Corporation, vol. 37(1), pages 1-22, March.
    18. Alessandra Casella & Adam B. Cox, 2018. "A Property Rights Approach to Temporary Work Visas," The Journal of Legal Studies, University of Chicago Press, vol. 47(S1), pages 195-227.
    19. Petrick, Martin, 2004. "Governing Structural Change And Externalities In Agriculture: Toward A Normative Institutional Economics Of Rural Development," IAMO Discussion Papers 14878, Institute of Agricultural Development in Transition Economies (IAMO).
    20. Nicola De Vivo & Giovanni Marin, 2018. "How neutral is the choice of the allocation mechanism in cap-and-trade schemes? Evidence from the EU-ETS," Argomenti, University of Urbino Carlo Bo, Department of Economics, Society & Politics, vol. 9(9), pages 1-24, January-A.

    More about this item

    Keywords

    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:uqseee:55105. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/decuqau.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.