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Mitigating agricultural fires with carrot or stick? Evidence from China

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  • Cao, Jing
  • Ma, Rong

Abstract

This paper examines the effects of biomass power plants (BPPs) on farmers’ use of agricultural fires for land clearance in China from 2001 to 2019. We show that the entry of BPPs leads to a significant reduction of agricultural fires by 14%. Farmers near BPPs display stronger responses, leading to a more significant reduction in straw burning, especially during high agricultural fire seasons. The notable decline in agricultural fires is likely driven by economic incentives provided by BPPs to farmers for collecting crop straw from their land. Additionally, straw-burning bans have limited effectiveness in reducing total agricultural fires, but they appear to reduce straw burning during nighttime, when the monitoring of agricultural fires is easier. We also provide evidence that local air quality has markedly improved, resulting in substantial health benefits that surpass the social benefits of reducing carbon emissions.

Suggested Citation

  • Cao, Jing & Ma, Rong, 2023. "Mitigating agricultural fires with carrot or stick? Evidence from China," Journal of Development Economics, Elsevier, vol. 165(C).
    • Handle: RePEc:eee:deveco:v:165:y:2023:i:c:s0304387823001293
    DOI: 10.1016/j.jdeveco.2023.103173
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    Cited by:

    1. Yang, Lisi & Liu, Linqing & Yan, Kai & Cai, Chunhua & Geng, Yannan, 2023. "“Carrot and stick”: Green fiscal policy, upper echelons expertise, and the green mergers and acquisitions," Finance Research Letters, Elsevier, vol. 58(PD).

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    More about this item

    Keywords

    Agricultural fire; Environmental externality; Straw burning; Biomass power plant;
    All these keywords.

    JEL classification:

    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
    • Q52 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Pollution Control Adoption and Costs; Distributional Effects; Employment Effects
    • Q53 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling

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