NONPOINT POLLUTION, WEEDS AND RISK

Nonpoint pollution from agricultural production continues to force regulators to rethink policies aimed at reducing input sources such as herbicides and fertilisers. This paper considers how a producer's choice of an input strategy defined by application rate or persistence affects input-use patterns, and consequently, nonpoint pollution. Working within an endogenous risk framework, we explore how input sets with herbicides defined either as self-insurance or self-protection are affected by increased risk of herbicide treatment failure. Our results suggest that increased risk will generally decrease both herbicide and fertiliser application rates, resulting in the use of less flexible and less persistent herbicides. In addition, a quantity constraint policy restricting the amount of herbicide applied will decrease the amount of fertiliser applied. 4