Agricultural Economic Report No. (AER-794) 73 pp

January 2001

Agri-Environmental Policy at the Crossroads: Guideposts on a Changing Landscape

Agri-environmental policy is at a crossroads. Over the past 20 years, a wide range of policies addressing the environmental implications of agricultural production have been implemented at the Federal level. Those policies have played an important role in reducing soil erosion, protecting and restoring wetlands, and creating wildlife habitat. However, emerging agri-environmental issues, evolution of farm income support policies, and limits imposed by trade agreements may point toward a rethinking of agri-environmental policy. This report identifies the types of policy tools available and the design features that have improved the effectiveness of current programs. It provides an indepth analysis of one policy tool that may be an important component of a future policy package-agri-environmental payments. The analysis focuses on issues and tradeoffs that policymakers would face in designing a program of agri-environmental payments.

Keywords: conservation programs, environmental policy, agricultural policy, policy instruments, agricultural program design, soil erosion, and nitrogen runoff

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Last updated: Thursday, January 25, 2001

For more information contact: Dwight Gadsby, Daniel Hellerstein, Jeffrey Hopkins, Paul Johnston, Mitch Morehart, Mark Smith, Roger Claassen, LeRoy Hansen, Mark Peters, Vince Breneman, Marca Weinberg, Andrea Cattaneo, and Peter Feather