טכניון מכון טכנולוגי לישראל
הטכניון מכון טכנולוגי לישראל - בית הספר ללימודי מוסמכים  
M.Sc Thesis
M.Sc StudentFishman Yaron
SubjectDynamic and Intersectorial External Effects of Nitrogen
Fertilizer
DepartmentDepartment of Industrial Engineering and Management
Supervisors Professor Mordechai Shechter
Dr. Nir Becker


Abstract

    The research objective is to present by employing dynamic economic model, the negative external effects of nitrogen fertilizers on the groundwater quality. The research compares the "private" solution of a profits - maximizing farmer, who ignores the negative external effects in using nitrogen fertilizers, to that of a social planner (with and without groundwater cleaning process), who takes into account these externalities in maximizing social welfare. The research focuses on finding an optimal social steady - state equilibrium. The analysis  is applied to corn production in the Rehovot region that lies above the coastal aquifer. The solution identifies an optimal economic balance between two economic components costs: (1) The costs of cleaning drinking water from the aquifer after they  have been contaminated beyond the quality standard ("environmental cleaning cost") and (2) profits losses to farmers, due to restrictions imposed on using nitrogen fertilizers. ("environmental contamination prevention costs").
   This research model provides decision makers with an economic tool, to deal with the conflict between the need for nitrogen fertilizers in agricultural production and the requirements for clean groundwater.