Risk Management and the Environment

by Babcock, Bruce A.; Fraser, Robert W.; Lekakis, Joseph N.

• ISBN13: 9781402009815
• ISBN10: 140200981X
• Format: Hardcover
• Copyright: 2003-01-01
• Publisher: Kluwer Academic Pub

Summary

This book addresses one of the key features of contemporary government policy: how to integrate the economic role of agriculture with the societal role of the rural environment. Historical agricultural policy has focussed on encouraging production while protecting farmers from market risk. However production surpluses combined with growing concern over the environmental impacts of intensive agriculture has led to policy changes, which have exposed farmers to more market risk and required them to take account of their impact on the environment. For the first time this book brings these developing policy issues together with a comprehensive consideration of both theoretical and empirical aspects. The first part of the book contains a set of six theoretical contributions to the economics of the agri-environment, including consideration of the associated policy implications. Building on this theoretical base, the second part contains four international case studies of agri-environmental policy. All the authors are well-known experts in their field, and the original material contained in this book should be of interest to academic agricultural and environmental economists, postgraduate students, and policymakers.

Table of Contents

Tables	vii
Figures	ix
Contributors	x
Preface	xii
Introduction Risk Management and the Environment in Agriculture: A Key Policy Theme	1	(10)
Bruce A. Babcock
Robert W. Fraser
Joseph N. Lekakis
Part I Theory
The State-contingent Approach to Modeling Environmental Risk Management	11	(18)
John Quiggin
Robert G. Chambers
The Precautionary Principle in Practice: How to Write a Call Option on the Environment	29	(23)
Greg Hertzler
Factors Determining Best Management Practice Adoption Incentives and the Impact of Green Insurance	52	(15)
Paul D. Mitchell
David A. Hennessy
Uncertainty and Adoption of Sustainable Farming Systems	67	(15)
David J. Pannell
Incentive Design for Introducing Genetically Modified Crops	82	(14)
Ross Kingwell
An Economic Risk Assessment of the Impact on Producers of Removing Quarantine Restrictions	96	(17)
Robert W. Fraser
Part II Case Studies
Risk Attitudes and Risk Perceptions of Crop Producers in Western Australia	113	(21)
Amir K. Abadi Ghadim
David J. Pannell
Valuing Pest Control: How Much is Due to Risk Aversion?	134	(11)
Terrance M. Hurley
Bruce A. Babcock
The Influence of Price Risk on Set-aside Choice in the EU	145	(16)
Hild Rygnestad
Robert W. Fraser
Production Risks, Acreage Decisions, and Implications for Revenue Insurance Programs	161	(20)
JunJie J. Wu
Richard M. Adams
The Effects of Crop Insurance and Disaster Relief Programs on Soil Erosion: The Case of Soybeans and Corn	181	(15)
Barry K. Goodwin
Vincent H. Smith
Conclusion	196	(3)
Bruce A. Babcock
Robert W. Fraser
Joseph N. Lekakis
Author Index	199	(4)
Subject Index	203