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Valuing Ecosystem Services and Downstream Water Quality Improvement in the U.S. Corn Belt

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Abstract

We develop a choice experiment (CE) to estimate the benefits of nutrient reductions in the US Corn Belt. The study area covers Illinois, Indiana, and Iowa, the three states that contribute the largest amount of nutrients to the Gulf of Mexico and whose nutrient reductions are vital to achieving targets to reduce the hypoxic dead zone in the Gulf. We find that the public places large values on various local ecosystem services, including aquatic biodiversity, aesthetics of increased farm landscape diversity associated with conservation practices, and water-based recreational activities. Moreover, the results indicate that upstream residents have a strong preference for water quality far downstream in the Gulf of Mexico as characterized by reducing the size of the dead zone. Our analysis of observed taste heterogeneity indicates that public preferences vary depending on familiarity with nutrient pollution issues, users versus non-users of local ecosystem services, and different age groups. Our findings inform policies to improve water quality in the Gulf of Mexico and local water bodies in the US Corn Belt.

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Notes

  1. We use the SWAT (Soil and Water Assessment Tool) to obtain the range of total phosphorus (TP) concentrations in waters caused by various farm management practices. Then, we explore linear relationships between TP and the number of macroinvertebrate species as well as the number of macroinvertebrate species and fish species, using the US Environmental Protection Agency’s National Lakes Assessment and the National Rivers and Streams Assessment data in our study region. Since no available water quality modeling covers our entire study region, we utilize modeling data from a typical watershed in the region (the Upper Sangamon River Watershed in Illinois) and assume that water quality changes simulated in this watershed can represent the changes in the study region. Although there are potentially more influential factors than TP alone in determining the abundance of aquatic species, we obtain a linear correspondence without incorporating those factors for the purpose of informing feasible attribute levels. Using TP in exploring the relationship is consistent with ecology studies that show nutrients as critical drivers for macroinvertebrates and fish species diversity (Egertson and Downing 2004; Koperski 2021). The linear relationships and the potential TP range from the SWAT inform how much macroinvertebrates and fish species can increase due to nutrient reductions relative to the baseline.

  2. Similar to the aquatic life attribute, we derive a linear correspondence between total phosphorus (TP) and Chlorophyll-a, a widely used indicator of algal toxins for recreational safety. According to the World Health Organization (WHO) guideline, Chlorophyll-a concentrations greater than 50 μg/L could entail a high risk of recreational exposure to toxins (WHO, 2003). Our SWAT modeling and the estimated linear effects of TP on Chlorophyll-a indicate that the baseline TP (300 μg/L) corresponds to the high risk for recreational water use (Chlorophyll-a = 90.9 μg/L) but decreases in TP can reduce Chlorophyll-a to the level sufficiently below the high-risk threshold where water bodies can support all types of recreation.

  3. Keane and Wasi (2013) note that there is no reason to restrict \(\gamma\) to the [0, 1] interval and allow \(\gamma <0\) or \(\gamma >1\). In estimating the full GMNL model, we also estimated \(\gamma\) without the domain restriction.

  4. T-tests reject the null hypotheses of equal WTP estimates for (1) cover crops ($11) and buffers + cover crops ($18) with p-value < 0.001, and for (2) buffers + cover crops ($18) and perennials + buffers + cover crops ($24) with p-value = 0.002.

  5. We note that our survey elicited visual preferences by presenting a landscape photo where cover crops are planted on “all” crop fields shown (Appendix 1). However, given that people can generally view only a limited scope of the whole landscape surrounding them and that planting cover crops on the total cropland area is unrealistic, we maintain the 50% share as a reasonable policy scenario.

  6. We consider four counties for the Chicago area, including Cook County of the City of Chicago and three adjacent urbanized counties (Du Page, Will, and Lake counties). The total number of households in the four counties is 2,790,519 (2019 American Community Survey).

Abbreviations

ASC:

Alternative specific constant

BS:

Buffer strips

CC:

Cover crops

CE:

Choice experiment

GMNL:

Generalized multinomial logit

MARB:

Mississippi/Atchafalaya river basin

MWTP:

Marginal willingness to pay

USDA NASS:

United States department of agriculture, national agricultural statistics service

US EPA:

United States environmental protection agency

WTP:

Willingness to pay

References

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Funding

The research was supported by US National Science Foundation (INFEWS/T1 award number 1739788).

Author information

Authors and Affiliations

  1. Department of Agricultural and Consumer Economics, University of Illinois at Urbana-Champaign, 1301 West Gregory Drive, Urbana, IL, USA

    Seojeong Oh

  2. Economic Research Service, United States Department of Agriculture, Washington, D.C., USA

    Benjamin M. Gramig

Authors
  1. Seojeong Oh
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  2. Benjamin M. Gramig
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Correspondence to Seojeong Oh.

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Disclaimer The findings and conclusions in this publication are those of the authors and should not be construed to represent any official USDA or U.S. Government determination or policy.

Appendices

Appendix 1

Survey Instrument

The survey instrument as it appeared to respondents in Qualtrics is provided below.

2.1 Consent

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2.2 Screening and Demographic Questions

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2.3 Questions Related to the Survey Topic

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2.4 Background Information

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2.5 Description of Attributes and Levels

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2.6 Cheap Talk and Policy Consequentiality

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2.7 Choice Questions

At this section of the survey, we randomly assigned respondents to one of three blocks where each respondent answers eight choice questions. Below is an example of a choice question.

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2.8 Attribute Non-Attendance and Perceived Consequentiality

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2.9 Additional Questions and a Survey Bot Check

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The following two questions refer to specific recreational activities a respondent chooses in the above question. We display the questions below when a respondent chooses ‘Boating’.

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2.10 COVID-19 Impacts on Households

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Appendix 2

Observed Preference Heterogeneity Model by State

See Table 6

Table 6 Results of the generalized multinomial logit (GMNL) model in WTP space
Full size table

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Oh, S., Gramig, B.M. Valuing Ecosystem Services and Downstream Water Quality Improvement in the U.S. Corn Belt. Environ Resource Econ 85, 823–872 (2023). https://doi.org/10.1007/s10640-023-00784-4

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