The economics of soil conservation and water management policies in the Otago high country

Abstract

This report presents an economic analysis of soil conservation and water management policies for high country tussock grasslands. With few exceptions, high country water and soil conservation measures are not obligatory for private stock owners. The government's policy has been to encourage the adoption of sound conservation practices in relation to development subsidies and services to run holders that make such practices economically attractive. Services are extended in the form of detailed farm development plans "Soil and Water Conservation Plans (SWCP's)" along with follow up management assistance and government cost-sharing of the required development expenditure. Some important questions which stem from this voluntary programme are: Do the SWCP's generate enough private benefits to warrant their ready adoption by farmers?; do the social benefits of SWCP's exceed the social costs?; and can modification of government cost-sharing arrangements lead to a higher level of benefit to the nation?