Model Captures the Interaction Between Agriculture
and the Environment
Robert Johansson and Scott
Malcolm
Agricultural production and its impact on
land, water, and air quality is the focus of policies
and programs aimed at improving the environmental
performance of the U.S. farm sector. These policies
can have varying economic and environmental effects,
depending on how they are designed. A framework
that considers the interactions between farm product
supply, production practices, the environment, and
prices for crop and livestock products can help
better inform policymakers about the potential effects
of agri-environmental policies. Statistical analyses
of historical data allow researchers to draw inferences
about these relationships. Such inferences, however,
say little about the policy effects (intended or
otherwise) across sectors of the agricultural economy.
The Regional Environment and Agriculture
Programming (REAP) Model helps address this informational
need. REAP (formerly named the U.S. Mathematical
Programming Agricultural Sector Model, or USMP)
was developed in the mid-1980s to augment ERS’s
economic analysis. Model extensions over the
last 20 years have substantially expanded the resource
and environmental underpinnings of the model, increasing
its value to research efforts.
For example, REAP greatly enhanced
ERS analysis of the potential economic and environmental
effects of requirements to improve the way farmers
manage animal waste. Each region in the model faced
a constraint on manure nutrient applications to
cropland, and the economic effects were conveyed
throughout the agricultural economy. Increased costs
in animal waste management led to changes in animal
production and revenues (affecting livestock producers),
the price of feed grains (affecting crop producers),
and the prices of final products (affecting consumers).
Model results indicate significant regional differences
in the effects of the requirement: production increased
in the Corn Belt, where land for spreading manure
is relatively plentiful, and decreased in Appalachia,
where cropland is relatively scarce. The model also
showed how shifts in production affected regional
soil erosion and losses of nutrients to water and
the atmosphere.
The regional disaggregation of
the effects of U.S. agri-environmental policy is
a key feature of REAP that helps distinguish it
from other models used to analyze agricultural issues
on a national or global scale. REAP describes agricultural
adjustments to policy shocks across 90 regions,
based on soil type and location. Agricultural production
and environmental activities in REAP are modeled
using the Environmental Policy Integrated Climate
Model. REAP determines regional land use, crop and
animal production levels, and production practices—including
multiyear crop rotations, tillage practices and
nitrogen fertilizer application rates—endogenously
with market-clearing prices. Crop and livestock
sectors (primary and secondary) interact in the
model’s solution process.
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