Document Type
Article
Publication Version
Published Version
Publication Date
12-1995
Journal or Book Title
Journal of Agricultural and Resource Economics
Volume
20
Issue
2
First Page or Article ID Number
316
Last Page
327
Abstract
Green payment programs, where the government pays farmers directly for environmental benefits, are an alternative to the current method of achieving environmental benefits which restricts farming practices in exchange for deficiency payments. This article presents a voluntary green payment program using the principles of mechanism design under asymmetric information. Information asymmetry arises because the government knows only the distribution of farmers' production situations, rather than farm-specific information. The program is demonstrated with irrigated corn production in the Oklahoma high plains. A green payment program can reduce budget costs and pollution, while increasing the net social value of corn production.
Copyright Owner
Western Agricultural Economics Association
Copyright Date
1995
Language
en
File Format
application/pdf
Recommended Citation
Wu, JunJie and Babcock, Bruce A., "Optimal Design of a Voluntary Green Payment Program under Asymmetric Information" (1995). Economics Publications. 25.
https://lib.dr.iastate.edu/econ_las_pubs/25
Included in
Agricultural and Resource Economics Commons, Agricultural Economics Commons, Economics Commons, Environmental Policy Commons, Natural Resource Economics Commons, Natural Resources Management and Policy Commons
Comments
This article is from Journal of Agricultural and Resource Economics 20 (1995): 316–327. Posted with permission.