Natural Resource Economics
The long-term viability of the food supply depends upon the sustainable use of natural resources. Unlike most agricultural inputs, such as fertilizer or animal feed, most natural resources do not have prices determined in the market. The field of Natural Resource Economics seeks to value natural resources to aid in the optimization of the production of goods and services from agricultural lands while protecting the environment.
Importance of Natural Resource Economics
Successful stewardship of the land entails understanding the complex interrelationships between environmental and market forces. Research is pursued to understand why producers adopt sustainable technologies and identify incentives as well as costs and benefits to producers and the environment.
Resource economists provide science-based information to help agriculture producers balance production demands with elements central to agricultural sustainability, including:
- Maintenance and improvement of air and soil quality
- Adaptation and management of climate change dynamics
- Efficient use of surface and groundwater supplies
- Maintenance of landscape vistas, wild plant and animal habitats, and recreational areas
Natural resource economics also demonstrates how policy incentives might motivate better choices by agriculture producers and makes predictions about the potential side effects of those choices.
NIFA programs support development of a robust agricultural market sector through:
- Supporting collaboration between scientists and natural resource economists
- Exploring land-use strategies
- Developing strategies to optimize production while protecting the environment
- Conducting research to help policymakers, farmers, and ranchers make sound land-use decisions
- Developing better ways to assign value to non-market entities and ecosystem services