Working Paper: NBER ID: w28591
Authors: Nicholas J. Sanders; Alan Barreca
Abstract: The Acid Rain Program (ARP) cut sulfur dioxide (SO2) emissions from power plants in the United States, with considerable benefits. We show this also reduced ambient sulfate levels, which lowered agriculture productivity through decreased soil sulfur. Using plant-level SO2 emissions and an atmospheric transport model, we estimate the relationship between airborne sulfate levels and yields for corn and soybean. We estimate crop revenue losses for these two crops around $1-1.5 billion per year, with accompanying decreases in land value. Back of the envelope calculations of the costs to replace lost sulfur suggest producer responses were limited and suboptimal.
Keywords: Acid Rain Program; sulfur dioxide emissions; agricultural productivity; corn; soybean
JEL Codes: Q15; Q53
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Reduction in SO2 emissions (Q52) | Decreased ambient sulfate levels (Q53) |
| Decreased ambient sulfate levels (Q53) | Negative impact on agricultural productivity (corn and soybean) (Q11) |
| Negative impact on agricultural productivity (corn and soybean) (Q11) | Decrease in agricultural land values (Q15) |
| Decrease in agricultural land values (Q15) | Financial loss of around $14 billion (G33) |
| Reduction in SO2 emissions (Q52) | Negative impact on agricultural productivity (corn and soybean) (Q11) |