Rapid urban and agricultural development in the region contributed to the decline of the gnatcatcher population, and it was listed as a federally threatened species in 1993. In April 2003, USFWS designated almost 500,000 acres of critical habitat for the gnatcatcher in Los Angeles, Orange, Riverside, San Bernardino, San Diego, and Ventura counties. Sunding’s analysis suggests extremely high economic impacts for this designation—between $4.6 and $5.1 billion for the period from 2003 to 2020. This implies costs of approximately $10,000 per designated acre, and of $150,000 per developed acre.In this case, the costs are primarily borne by consumers in the form of higher housing prices, as the designation will impose serious restrictions on the development of new housing. According to Sunding, these costs are largely imposed in three ways: the increase in out-of-pocket costs to developers, the delay of completion of housing projects, and the reduced scale of these projects. For example, in the 1990s the USFWS proposed to ban the use of two non-restricted anticoagulant pesticides, chlorophacinone and diphacinone, because their use to control ground squirrels and jackrabbits on cropland were impacting the endangered San Joaquin kit fox. Although the kit fox does not generally consume the treated crops, it is a predator that often feeds on the affected target species. Since these pesticides accumulate in the liver of the dead pest, the kit fox could be poisoned through biological magnification of the anticoagulants. Zilberman, Siebert and Zivin estimated that the direct costs of the proposed restrictions to growers in Kern County would be in excess of $70 million per year. They termed these costs as shortrun, because they hypothesized that suitable alternatives to the restricted pesticides may be developed,cultivo del arandano although there would likely be some delay before their implementation.

Climate change, caused by increased stock of greenhouse gases , is potentially one of the most serious environmental problems facing mankind. Clouds and GHGs allow the sun’s heat to pass through to the earth, but they form a barrier to the outgoing infrared heat, thus acting as a greenhouse. A greater concentration of GHGs increases this, leading to the possibility of climatic change and global warming. The atmospheric concentration of carbon dioxide , the major GHG, has increased by approximately 30 percent since the Industrial Revolution. The Intergovernmental Panel on Climate Change , a United Nations sponsored research group, identifies a number of recent climate changes that are attributable in part to human activity. The estimated global mean temperature has increased by 0.6° plus or minus 0.2° C over the last 50 years. Continental precipitation has increased by 5-10 percent in the Northern Hemisphere, and decreased in some regions. In the absence of policy intervention, CO2 concentrations are projected to increase by 75 to 350 percent above pre-specified levels during the next century . Temperature is projected to increase by .14-5.8°C, a change approximately two to 10 times larger than the estimated increase during the last century. There is a growing body of literature on the impact of climate change on agriculture. Many of these studies are based on the ecosystem movement paradigm, which assumes that “ecosystems will migrate relatively intact to new locations that are close analogs to their climate and environment” . The estimated levels of global warming are likely to cause 100-to-200-mile movement of climate and ecosystems away from the Equator and towards the Poles. With that, the Sacramento Valley may have the climate conditions of Bakersfield, and the San Francisco Bay will have the weather of Los Angeles. Under these assumptions, some regions close to the Equator will be deserted, and currently uncultivated lands close to the Poles will enter production. Some lands will switch from “cold climate” crops to “warm climate” crops, and current use patterns will continue on much of the agricultural lands with some modifications. Since the area of arable landmass declines as one moves away from the Equator, the “ecosystem movement” may result in reduction of supplies of food products.

The higher carbon sequestration levels associated with climate change will also result in a “fertilization effect” that will increase yields per acre. Climate change will increase food supplies if the “fertilization effect” dominates the “ecosystem movement” effect, and it will decrease if the “ecosystem movement” effect is dominant. Studies reviewed by Gitay et al. suggest that climate change does not pose a serious threat to the U.S. and global food capacity. The estimated annual impacts of climate change on U.S. agriculture range in most studies between a net loss of $10 billion to a net gain of $10 billion. On the other hand, the empirical simulations mentioned above suggest that the distributional effects of climate change are likely to be substantial. Adams, Hurd, and Reilly found that northern regions in the United States are likely to gain from climate change while southern regions are likely to lose.In particular, northern regions in California and Oregon may gain from climate change, while southern California regions may lose. Most of the analysis on the impact of climate change was based on regions with rainfed agriculture. California agriculture is unique in its reliance on irrigation, which requires heavy investment in fixed infrastructure. Furthermore, perennial crops that are prominent in California are also investment incentives. Thus, the adjustment to climate change may require high cost of fixed investment of relocation. Most of the water infrastructure in California has been subsidized by the public sector and, thus, historical private costs of production are not good indicators of cost after adjustment to climate change . Without the subsidies, the cost of water is likely to increase, and that will reduce the profitability of agriculture and restrict the extent to which agricultural production capacity is relocating. Climate change will change the precipitation pattern of California, and that will add extra cost in addition to the relocation effect. Increase in temperature will increase the amount of rain relative to snow during the winter. Less water will be stored in snow packs, and larger volumes of runoff will be released earlier in the season, exacerbating the risk of flooding and reducing the availability of water for agriculture in the late spring and summer when demand is at its peak . Adjusting to these changes will require extra investment in dams and infrastructure.

Most of the impact assessments of climate change treat it as a transition occurring at a given moment in time. However they tend to underestimate the cost and complexity of adjusting to climate change, since it is a continuous process that at present is subject to much uncertainty. Thus, several modifications of infrastructure and production patterns may occur as climate change progresses,maceta hidroponica and the lack of certainty may increase the adjustment cost . While much of the literature suggests that the impacts of climate change on U.S. agriculture are likely to be modest, the analyses in the case for California suggest that the cost of adjustment to climate change may be quite substantial.Much of the preceding discussion has illustrated how regulation seeks to mitigate the negative environmental externalities that arise from agriculture in California. Yet there is also recognition by both the public and the government of the role that agriculture plays in land stewardship. There are major government programs that reward participating farmers for conservation activities. Furthermore, agriculture provides valuable recreational amenities to consumers, both indirectly and directly. The U.S. Department of Agriculture, through the Farm Service Agency and the National Resource Conservation Service, offers programs such as the Conservation Reserve Program , Wetland Reserve Program, Grasslands Reserve Program, and the Environmental Quality Incentives Program to encourage farmers to engage in conservation activities.In the same way that taxes can be used to discourage activities that have negative side effects, governments may choose to subsidize those activities with “positive externalities”—that is, activities that carry benefits that are enjoyed by parties other than those who have direct control over the resource. The economic justification for such subsidies is that in their absence, private decision making will result in too few of these conservation activities. By subsidizing the desirable activities, governments can increase the private benefits to the farmers, and thus encourage a move toward a more optimal level of provision. The Conservation Reserve Program is the largest of these programs. Under the CRP, farmers are paid to retire environmentally sensitive cropland from production. Agricultural land may be eligible if it is highly prone to erosion, contributes to a serious water quality problem, provides important wildlife habitat, or can provide other substantial environmental benefits. Farmers can also receive additional reimbursement for conservation expenses, such as planting cover crops to reduce erosion on retired land. Although the CRP was established in its current form in the 1985 Farm Bill, it has its origins in the 1950s, when Congress established similar programs in the Soil BankAct. These programs were explicitly touted as a way of avoiding a repeat of the 1930s Dust Bowl. The renewed interest in such programs in the 1980s was in large part a response to the depressed agricultural commodity prices of the time.

The CRP was not only seen as a way of achieving environmental protection, but it also allowed for another channel of payments to distressed farmers and helped to ease overproduction by retiring land from active use. The CRP has been reauthorized in every subsequent farm bill, and has been growing at a moderate pace in recent years. USDA will pay out $1.6 billion to American farmers under the CRP between October 2003 and September 2004; these payments cover over 34 million acres in all fifty states. Participation in California is fairly modest, with 383 farms receiving $4.4 million in payments for just under 143,000 acres of set-aside land in 2003-2004. In contrast, Texas farmers will receive over $142 million for conservation of over 4 million acres of land. At the same time, the average payments received by participating farms in California are well over the national average of $4,354 per participating farm . The EQIP program is of much greater importance to California farmers. EQIP was first enacted in the 1996 Farm Bill, and its reauthorization in the 2002 Farm Bill provides $11.6 billion in assistance over ten years. EQIP grants farmers payments for specific environmental improvements on their land. Participating farmers can receive cost share assistance for up to 75 percent of the cost of environmental projects that fit in to the priority areas chosen for each state. In California alone, $38.6 million was allocated for the fiscal year 2003. About half of this money was designated for special programs such as water conservation in the Klamath basin, replacement of diesel engines, and statewide surface and groundwater conservation projects. The other half goes to “regular appropriations,” which are distributed on a per-county basis. For 2003, Fresno, Merced, Riverside, Stanislaus, and Tulare counties were each slated to receive over one million dollars in EQIP funds . Such “green payment” programs are likely to become more important in the future, as the liberalization of international trade makes it increasingly more difficult for governments to continue traditional agricultural price support programs. Under current WTO regulations, agricultural conservation programs are considered more acceptable than price supports, because they support farmers in ways that have less of an impact on agricultural markets. This trend, if it continues, may be of particular benefit to many California farmers, who receive relatively less benefit from price support programs than farmers in other parts of the country. It is interesting to note that agricultural support programs have traditionally received strong support from urban, as well as rural, residents. This is probably due in large part to the role that agriculture plays in maintaining the rural qualities enjoyed both by Californians and the state’s many visitors. Visitors to the countryside enjoy the scenery, connection to the nation’s history, and perceived lifestyle offered by agricultural activities. Even those individuals who rarely visit rural areas may benefit from simply knowing that these areas are being maintained in a certain way, a phenomenon that economists refer to as “existence value.” For these reasons, society’s interest in providing public support to agricultural activities extends beyond analtruistic concern for the welfare of farmers or arguments of domestic food security.