Licentiate thesis, 2013
Cost effective nutrient abatement in the Baltic SeaLindqvist, Martin
AbstractThe overall aim of this thesis is to increase the understanding of cost-effective nutrient abatement in the Baltic Sea. This is done under various assumptions about the underlying abatement measures available to the social planner, future changes in nutrient outflow caused by climate change as well as the impact of technical change on the cost of abatement. The thesis consists of three papers, which examines different aspects of cost effective nutrient abatement in the Baltic Sea. Paper I analyses the value of introducing mussel farming as an abatement measure for reduction of nutrients in the Baltic Sea. We aim at determining the value of mussel farming as an abatement measure taking alternative abatement measures, spatial scale and different nutrient load targets into consideration. The result show that calculated marginal cost by mussel farm can be considerably lower than that of other abatement measures, but also relatively high depending on mussel growth, sales options and formulation of nutrient load targets. Paper II examines the impact of climate change, structural changes in the agricultural sector and demographic development on the cost of fulfilling the nutrient abatement targets in the 2007 Baltic Sea Action Plan (BSAP). In paper II we apply a dynamic discrete model of control costs, which also takes the dynamics of nutrients in each marine basin into consideration. The results show that the main drivers of future nutrient loads work in different directions and that climate change may counter some of the increases in costs brought by structural change in the agricultural sector. The aim of paper III is to show the impact of learning-by-doing induced technical change on the costs of nutrient abatement in the Baltic Sea. Learning-by-doing is modeled in a reduced form through the abatement cost function. In this setting increased abatement leads to increased experience, which reduce the cost of abatement. The results show that learning-by-doing induced technical change can decrease costs substantially depending on learning rate.
KeywordsCost effective; Nitrogen; Phosphorous; Nutrients; Abatement cost; Climate change; Learning by doing; Baltic Sea; Mussels; Dynamic programming
Publisher: Dept. of Economics, Swedish University of Agricultural Sciences
Swedish University of Agricultural Sciences, Department of Economics
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