RT Journal Article
SR Electronic
T1 Costs of Nitrogen Runoff for Rural Water Utilities: A Shadow Cost Approach
JF Land Economics
JO Land Econ
FD University of Wisconsin Press
SP 12
OP 39
DO 10.3368/le.93.1.12
VO 93
IS 1
A1 Roberto Mosheim
A1 Marc Ribaudo
YR 2017
UL http://le.uwpress.org/content/93/1/12.abstract
AB This paper explores the interactions among scale and density economies, productive efficiency, water quality, and customer characteristics, and their impact on the costs of delivering treated drinking water. Implicit benefits of nitrogen abatement are also derived and hypothesis tests concerning their hypothesized drivers are conducted. Key findings are that nitrogen removal costs increase with rising raw water nitrogen concentration coming from agricultural activities, and that network density and system size matter in determining average total costs of community water systems. Merging water systems to take advantage of scale economies may be difficult due to the heterogeneity of the sector, however. (JEL Q25, Q53)