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Uncertainty and Split Nitrogen Application in Corn Production

Author

Listed:
  • Eli Feinerman
  • E. Kwan Choi
  • Stanley R. Johnson

Abstract

The split application of nitrogen provides insurance against the risk that late spring application will be infeasible because of wet soil. Risk aversion and production uncertainty have little impact on total nitrogen available to the crop but do affect the split in application and the total nitrogen applied. A risk-averse farmer applies more (less) nitrogen prior to planting and total nitrogen than a risk-neutral farmer if nitrogen and water are substitutes (complements). For the case of substitutes, the nitrogen lost through leaching is the premium which the risk-averse farmer pays to insure a proper level of nitrogen.

Suggested Citation

  • Eli Feinerman & E. Kwan Choi & Stanley R. Johnson, 1990. "Uncertainty and Split Nitrogen Application in Corn Production," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 72(4), pages 975-985.
    • Handle: RePEc:oup:ajagec:v:72:y:1990:i:4:p:975-985.
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    File URL: http://hdl.handle.net/10.2307/1242629
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    Citations

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    Cited by:

    1. Kingwell, Ross S., 1995. "Effects of Tactical Responses and Risk Aversion on Farm Wheat Supply," Review of Marketing and Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 62(01), pages 1-14, April.
    2. Asci, Serhat & Borisova, Tatiana & VanSickle, John J., 2015. "Role of economics in developing fertilizer best management practices," Agricultural Water Management, Elsevier, vol. 152(C), pages 251-261.
    3. Camille Tevenart & Marielle Brunette, 2021. "Role of Farmers’ Risk and Ambiguity Preferences on Fertilization Decisions: An Experiment," Sustainability, MDPI, vol. 13(17), pages 1-27, August.
    4. Jisang Yu & Nathan P. Hendricks, 2020. "Input Use Decisions with Greater Information on Crop Conditions: Implications for Insurance Moral Hazard and the Environment," American Journal of Agricultural Economics, John Wiley & Sons, vol. 102(3), pages 826-845, May.
    5. Nurmakhanova, Mira, 2008. "Essays on fall fertilizer application," ISU General Staff Papers 2008010108000016739, Iowa State University, Department of Economics.
    6. Lichtenberg, Erik, 2002. "Agriculture and the environment," Handbook of Agricultural Economics, in: B. L. Gardner & G. C. Rausser (ed.), Handbook of Agricultural Economics, edition 1, volume 2, chapter 23, pages 1249-1313, Elsevier.
    7. Babcock, Bruce A. & Blackmer, Alfred M., 1992. "The Value Of Reducing Temporal Input Nonuniformities," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 17(2), pages 1-13, December.
    8. Claassen, Roger & Breneman, Vincent E. & Bucholtz, Shawn & Cattaneo, Andrea & Johansson, Robert C. & Morehart, Mitchell J., 2004. "Environmental Compliance In U.S. Agricultural Policy: Past Performance And Future Potential," Agricultural Economic Reports 34033, United States Department of Agriculture, Economic Research Service.
    9. Hennessy, David A. & Saak, Alexander E., 2003. "State-Contingent Demand for Herbicide-Tolerance Seed Trait," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 28(1), pages 1-14, April.
    10. Beata Itin‐Shwartz, 2024. "Survey based assessment of sustainable agricultural practices: Evidence from Indian plots," Agribusiness, John Wiley & Sons, Ltd., vol. 40(2), pages 416-457, April.
    11. Huang, Wen-Yuan & Hewitt, Tracy I. & Shank, David, 1998. "An Analysis Of On-Farm Costs Of Timing N Applications To Reduce N Losses," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 23(2), pages 1-23, December.
    12. Asci, Serhat & Borisova, Tatiana & VanSickle, John J., 2014. "Risks in Potato Production: Fertilizer, Water, and Producers’ Decision Making," 2014 Annual Meeting, February 1-4, 2014, Dallas, Texas 162536, Southern Agricultural Economics Association.
    13. McDonald, Jeffrey D. & Moffitt, L. Joe & Willis, Cleve E., 1997. "Application of mean-Gini stochastic efficiency analysis," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 41(1), pages 1-18.
    14. Wen-Yuan Huang & Richard Heifner & Harold Taylor & Noel Uri, 2000. "Timing Nitrogen Fertilizer Application to Reduce Nitrogen Losses to the Environment," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 14(1), pages 35-58, February.
    15. Thomas, Alban & Bontems, Philippe, 1998. "Information Value And Risk Premium In Agricultural Production Under Risk: The Case Of Split Nitrogen Application For Corn," 1998 Annual meeting, August 2-5, Salt Lake City, UT 20844, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    16. Huang, Wen-Yuan, 2002. "Using Insurance To Enhance Nitrogen Fertilizer Application Timing To Reduce Nitrogen Losses," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 34(1), pages 1-18, April.
    17. Choi, E. Kwan & Feinerman, Eli, 1995. "Regulation Of Nitrogen Pollution: Taxes Versus Quotas," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 20(1), pages 1-22, July.
    18. Asci, Serhat & Borisova, Tatiana & VanSickle, John J. & Zotarelli, Lincoln, 2012. "Risk and Nitrogen Application Decisions in Florida Potato Production," 2012 Annual Meeting, February 4-7, 2012, Birmingham, Alabama 119797, Southern Agricultural Economics Association.
    19. Bontems, Philippe & Thomas, Alban, 2001. "Optimal Regulation Under Asymmetric Information And Risk Aversion With An Application To Pollution Control," 2001 Annual meeting, August 5-8, Chicago, IL 20727, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    20. Brian Lee & Jhih‐Yun Liu & Hung‐Hao Chang, 2020. "The choice of marketing channel and farm profitability: Empirical evidence from small farmers," Agribusiness, John Wiley & Sons, Ltd., vol. 36(3), pages 402-421, June.

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