Three essays on environmental and resource economics

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Meyer, Kevin
Major Professor
Catherine L. Kling
David A. Keiser
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Environmental issues in modern day Iowa are a perfect example of the indirect consequences of exploiting natural resources. Over 12,000 years ago, glaciers left the state with rich and fertile soil, perfect for agriculture. Over the course of more than one hundred years, Iowa's landscape has been cleared and drained to gain access to this valuable farmland. While the economic benefits of agriculture are clear, it is important to understand the environmental consequences of this transformation. This dissertation uses economic tools and analysis to investigate three environmental and resource issues related to the complex interplay between Iowa agriculture and the environment.

The first chapter examines the relationship between an important adaptive tool, tile drainage, and climate. Tile drainage is largely responsible for transforming Iowa from mostly wetlands into prime farmland. It fundamentally changes the relationship between land, climate, and soil, by draining away excess water, allowing crops to grow. This chapter uses observations from over 800,000 farms across the U.S. to estimate the relationship between farmland value and climate while explicitly incorporating tile drainage. We find fundamental differences in the relationship between tile drained and non-tile drained land, which has not been accounted for in previous research. Using climate projections, we estimate the impact of climate change on farmland and show how these estimates can be biased when tile drained and non-tile drained farms are pooled together.

The second chapter looks at the relationship between land change and lake water quality. While most of Iowa's lakes are artificial, many are popular destinations for fishing, boating, swimming, and other recreational activities. But their close proximity to farmland results in high nutrient levels and decreased water quality, which can reduce recreational and ecosystem benefits. This chapter combines fifteen years of water quality measurements with satellite images of land use to estimate the impact of land use change on water quality. These estimates are used to assess the lake water quality impacts of the Renewable Fuel Policy, a government policy which has had a large impact on agriculture and land use in Iowa.

The third chapter is concerned with the optimal management of the Iowa deer population through hunting licenses. Although not all species have benefited from the transformation of Iowa's landscape, the deer population has thrived due to a lack of predators and an abundant new food source in crops. While deer hunters enjoy a large population of deer, farmers and drivers face costs due to crop depredation and deer vehicle collisions, creating a complex management problem. This chapter uses the tools of dynamic programming to solve for an optimal policy that balances these opposing interests.

Altering the natural landscape turned Iowa into one of the most productive farming regions in the world, but has also created the need to balance intensive farming practices with the impacts on the surrounding environment. The tools of economics provide an appealing framework to propose solutions to these problems. The goal of the following three chapters is to use these tools to shed some light on three such issues Iowa currently faces. The insight and results from this research will hopefully help inform future researchers and policymakers in Iowa and beyond.

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Sun Jan 01 00:00:00 UTC 2017