Concerns about the impact of farm production on the quality of the Nation's drinking and recreational water resources have risen over the past 10 years. Because point sources of pollution were controlled first, agricultural nonpoint sources have become the Nation's largest remaining single water-quality problem. Both public and private costs of policies that address the conflict between agricultural production and water quality are relevant, but measuring the off-farm benefits and costs of changing water quality is difficult. Many of the values placed on these resources are not measured in traditional ways through market prices. This report explores the use of nonmarket valuation methods to estimate the benefits of protecting or improving rural water quality from agricultural sources of pollution. Two case studies show how these valuation methods can be used to include water-quality benefits estimates in economic analyses of specific policies to prevent or reduce water pollution.
Restricting or eliminating the use of atrazine in the Midwest would have important economic consequences for farmers and consumers. Atrazine is an important herbicide in the production of corn and other crops in the United States. Since atrazine is such an important herbicide, mandatory changes in application strategies are likely to generate sizable costs for producers and consumers. However, recent findings indicate that elevated amounts of atrazine are running off fields and entering surface water resources. This report presents the costs and benefits of an atrazine ban, a ban on pre-plant and pre-emergent applications, and a targeted ban to achieve a surface water standard. A complete atrazine ban is hypothesized to be the costliest strategy, while the targeted strategy is the least costly.