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Evaluation of Soil Test Information in Agricultural Decision-Making

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  • Babcock, Bruce A.
  • Carriquiry, Alicia L.
  • Stern, Hal S.

Abstract

The value of soil test information in planning application levels of fertilizer is determined by using agricultural field plot data to estimate the corn production function, to construct plausible prior distributions of nitrate levels and to determine the sampling distribution of soil test results. These quantities are used to determine the posterior distribution of soil nitrate concentrations given the results of a soil test. Optimal decisions concerning application levels of fertilizer are made with respect to this posterior distribution. Average reductions in fertilizer application rates range from 15% to 41%, depending on the form of prior information that is available. These reductions are achieved by increasing the variability of application rates over time. Disregarding the uncertainty that remains after soil testing significantly overstates the expected benefits of soil testing.
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Suggested Citation

  • Babcock, Bruce A. & Carriquiry, Alicia L. & Stern, Hal S., 1996. "Evaluation of Soil Test Information in Agricultural Decision-Making," Staff General Research Papers Archive 1139, Iowa State University, Department of Economics.
    • Handle: RePEc:isu:genres:1139
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    Cited by:

    1. Pautsch, Gregory R. & Babcock, Bruce A. & Breidt, F. Jay, 1999. "Optimal Information Acquisition Under A Geostatistical Model," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 24(2), pages 1-25, December.
    2. Queiroz, Pedro W. V. & Perrin, Richard K. & Fulginiti, Lilyan E. & Bullock, David S., 2023. "An Expected Value of Sample Information (EVSI) Approach for Estimating the Payoff from a Variable Rate Technology," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 48(1), January.
    3. Jon T. Biermacher & B. Wade Brorsen & Francis M. Epplin & John B. Solie & William R. Raun, 2009. "The economic potential of precision nitrogen application with wheat based on plant sensing," Agricultural Economics, International Association of Agricultural Economists, vol. 40(4), pages 397-407, July.
    4. Isik, Murat & Khanna, Madhu & Winter-Nelson, Alex, 2001. "Sequential Investment In Site-Specific Crop Management Under Output Price Uncertainty," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 26(1), pages 1-18, July.
    5. Babcock, Bruce A. & Pautsch, Gregory R., 1998. "Moving From Uniform To Variable Fertilizer Rates On Iowa Corn: Effects On Rates And Returns," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 23(2), pages 1-16, December.
    6. Olson, Kent D., 1998. "Precision Agriculture: Current Economic And Environmental Issues," Conference Papers 14487, University of Minnesota, Center for International Food and Agricultural Policy.
    7. 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.
    8. Isik, Murat & Khanna, Madhu & Winter-Nelson, Alex, 2000. "Sequential Investment In Site-Specific Crop Management Under Output Price Uncertainty: Implications For Nitrogen Pollution Control," 2000 Annual meeting, July 30-August 2, Tampa, FL 21875, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    9. Swinton, Scott M. & Jones, Kezelee Q., 1998. "From Data To Information: The Value Of Sampling Vs. Sensing Soil Data," Staff Paper Series 11674, Michigan State University, Department of Agricultural, Food, and Resource Economics.
    10. Mitchell, Paul David, 1999. "The theory and practice of green insurance: insurance to encourage the adoption of corn rootworm IPM," ISU General Staff Papers 1999010108000013154, Iowa State University, Department of Economics.
    11. Gregory R. Pautsch & Bruce A. Babcock & F. Jay Breidt, 1998. "Optimal Sampling Under a Geostatistical Model," Center for Agricultural and Rural Development (CARD) Publications 98-wp200, Center for Agricultural and Rural Development (CARD) at Iowa State University.
    12. Theobald, Chris M. & Talbot, Mike, 2004. "Bayesian selection of fertilizer level when crop price depends on quality," Computational Statistics & Data Analysis, Elsevier, vol. 47(4), pages 867-880, November.
    13. Lukin, Vladimir & Epplin, Francis M., 1999. "Value Of Soil Test Information For Crop Production," 1999 Annual meeting, August 8-11, Nashville, TN 21586, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    14. Mitchell, Paul D., 2003. "Value of imperfect input information in agricultural production," Agricultural Systems, Elsevier, vol. 75(2-3), pages 277-294.
    15. Murat Isik & Madhu Khanna, 2003. "Stochastic Technology, Risk Preferences, and Adoption of Site-Specific Technologies," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 85(2), pages 305-317.
    16. Fleming, Ronald A., 1997. "The Role Of Soil Test Information In Reducing Groundwater Pollution," 1997 Annual meeting, July 27-30, Toronto, Canada 21031, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    17. Fleming, Ronald A. & Adams, Richard M. & Ervin, David E., 1998. "The Role Of Soil Test Information In Reducing Groundwater Pollution," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 23(1), pages 1-19, July.

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