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Measuring External Effects of Agricultural Production: An Application for the Netherlands

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  • Oskam, A.J.

Abstract

Although the external effects of agricultural production receive considerable attention, the measurement of these effects is not well developed. In this paper, after introducing a theoretical approach, the methodology is applied to the Netherlands. The method used requires information about the quantities and the shadow prices of external effects. Different approaches were used to derive these shadow prices. Although many uncertainties still exist, incorporating the environmental effects of agricultural production reduces the gross value added by about 5-15 percent. Internalizing these external effects gives producers the opportunity to adjust inputs, output, and technology. It can thus be considered as a maximum effect.

Suggested Citation

  • Oskam, A.J., 1992. "Measuring External Effects of Agricultural Production: An Application for the Netherlands," 1992 Occasional Paper Series No. 6 197866, International Association of Agricultural Economists.
    • Handle: RePEc:ags:iaaeo6:197866
    DOI: 10.22004/ag.econ.197866
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    References listed on IDEAS

    as
    1. Chambers,Robert G., 1988. "Applied Production Analysis," Cambridge Books, Cambridge University Press, number 9780521314275, September.
    2. Baumol,William J. & Oates,Wallace E., 1988. "The Theory of Environmental Policy," Cambridge Books, Cambridge University Press, number 9780521322249.
    3. Hanley, Nick, 1990. "The Economics of Nitrate Pollution," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 17(2), pages 129-151.
    4. Pittman, Russell W, 1983. "Multilateral Productivity Comparisons with Undesirable Outputs," Economic Journal, Royal Economic Society, vol. 93(372), pages 883-891, December.
    5. Johansson,Per-Olov, 1987. "The Economic Theory and Measurement of Environmental Benefits," Cambridge Books, Cambridge University Press, number 9780521348102, September.
    6. Nick Hanley, 1990. "The Economics of Nitrate Pollution Control in the UK," Working Papers Series 90/5, University of Stirling, Division of Economics.
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