UBC Theses and Dissertations
Measuring the tangible benefits of environmental improvement : an economic appraisal of regional crop damages due to ozone Spash, Clive Laurence
The main purpose of this thesis is to empirically calculate the welfare changes which might be expected to result from potato yield reductions caused by ambient ozone loadings in the Lower Mainland of British Columbia. The objectives of the research are: (1) to review the scientific literature pertaining to the effects of ozone loadings on agricultural crops; (2) to review the methodologies employed in previous regional economic assessments of ozone damages; and (3) to apply an economically defensible technique to the analysis of welfare losses due to ozone. Ozone in the Lower Mainland may be pictured as being restricted laterally by the mountain ranges surrounding Vancouver, and vertically by stagnant high pressure systems. Land/sea breezes aid in transporting ozone and its precursors from Vancouver up the Fraser Valley towards important crop growing regions. The highest levels of ozone occur during spring and summer coinciding with the most active season for many crops. Seasonal ambient ozone dose, measured as hours-ppm>0.10ppm was found to be high in rural areas, especially Abbotsford, during the late 1970's and early 1980's, dropping to low levels in more recent years. Potatoes are one of the economically important crops in the Lower Mainland known to be sensitive to ozone. Potato tuber weight reductions are estimated to have reached 16.5 percent in the Abbotsford region in 1981 at seasonal ambient ozone loadings. An aggregate supply/demand model is set up for potato production in B.C. based upon prior estimates of supply and demand elasticities. This model assumes the price in the B.C. market is set exogeneously by U.S. imports. Thus, all policy relevent welfare changes affect producers' quasi-rent alone. Sensitivity of the model to import price, and the price elasticity of supply is tested. A range of welfare estimates is reported for a variety of ambient ozone loadings. The total damages to potato producers, assuming all regions of B.C. are affected by the same seasonal dose as Abbotsford, are calculated to be around one million dollars at ambient ozone loadings in four out of eight years. A peak occurred in 1981 at 2.4-2.9 million dollars total damages. Damages may be overestimated because 20-30 percent of potato production takes place outside the Lower Mainland, Abbotsford often appears to receive higher ambient ozone loadings than other regions, and not all potato cultivars grown in the Lower Mainland are as sensitive to ozone as that employed here. However, there are also reasons to be cautious over discounting these estimates as too large. Potato response to ozone is restricted to tuber weight reductions while other important effects may include increased plant stress and damage to crop quality. In addition, missing air quality information for some years and stations, suggests that actual ozone dose could be higher than calculated.