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| Preckel, Paul V.; Shively, Gerald E.; Baker, Timothy G.; Chu, Mei-Chin; Burrell, Jessica Eide. |
| This study examines incentives for input use under tournament contracts. We analyze implications of contract design for nitrate-based environmental externalities generated by agricultural producers. Outcomes are compared from contracts awarded by tournament to those from fixed-payment contracts. Our findings show contract insecurity can distort input use. The model developed in this analysis is applied to a region of the U.S. where tournament-based production is prevalent and groundwater contamination is a problem. We find contract insecurity increases nitrogen use by about 12%, resulting in a 17% increase in nitrate leaching. Implications for contract modification to reduce environmental externalities while maintaining contract incentives are discussed. |
| Tipo: Journal Article |
Palavras-chave: Crop Production/Industries. |
| Ano: 2000 |
URL: http://purl.umn.edu/30902 |
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