Agricultural Policies and Soil Degradation in Western Canada: An Agro-Ecological Economic Assessment, Report 1: Conceptual Framework

Aziz Bouzaher, Philip W. Gassman, Derald Holtkamp, David Archer, Alicia L. Carriquiry, Jason F. Shogren, Randall Reese, P. G. Lakshminarayan, William H. Furtan, R. C├ęsar Izaurralde, James Kiniry
October 1993  [93-SR 65]

The trade-off between agricultural production stability and environmental sustainability is a growing concern. The two major Canadian farm income stabilization programs of 1991, GRIP (Gross Revenue Insurance Plan) and NISA (Net Income Stabilization Account), are being considered for their resource neutrality impacts.

This report presents a conceptual framework designed to evaluate the environmental impacts of GRIP and NISA, focusing on land use, technology, and soil degradation shifts. The approach involves a multidisciplinary effort to create a system that permits evaluation of important relationships between policy, agricultural production and the environment. The focus is on development of an integrated agro-ecological economic system built around Agriculture Canada's Regional Agricultural Model (CRAM) and the Erosion Productivity Impact Calculator (EPIC) model.

CRAM, a risk-neutral, aggregate resource allocation model, is modified to include a more detailed technology specification and producer risk due to production and net return variability. Environmental impact indicator functions are developed using EPIC simulations based on experimental design and metamodeling techniques. The integrated system will be used to evaluate the economic and environmental impacts of alternative policies.

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