Richard Howitt

• University of California, Davis

In this contribution, we explore the sensitivity of parameter estimates derived through the generalized maximum entropy (GME) approach under alternative specifications of the width of the error term supports. Although many recommend a “three-sigma” rule for setting the width of this term, there can be noticeable differences in the results if it is...

Despite the importance of groundwater in the economy of the Hai River Basin (HRB), falling water tables and salinization of aquifers are both occurring in the region. Hydrological and hydrogeological studies have shown that increases in the salinization of parts of the freshwater aquifers are closely related to the extraction of groundwater. This s...

Crop rotation systems are an important part of agricultural production for managing pests, diseases, and soil fertility. Recent interest in sustainable agriculture focuses on low input-use practices which require knowledge of the underlying dynamics of production and rotation systems. Policies to limit chemical application depending on proximity to...

Water is a key input to agricultural production and therefore fluctuations in water availability may impact agricultural productivity and revenue. Climate science tells us that most of these fluctuations are increasingly resulting from intra-year, instead of interyearly, shifts in the timing and intensity of rainfall. Consequently predictions of th...

We develop a fully calibrated positive mathematical programming model for Hawaii’s local food systems—which captures the production and the consumer sides of the market. Then we use the model to assess two proposed policies—a general excise tax (GET) exemption on locally produced foods, and an investment in agricultural infrastructure. For the GET...

Making the transition from open-access groundwater rights to sustainable groundwater management is a formidable task for newly formed groundwater sustainability agencies in California. As agencies begin to decide how to make equitable water allocations, how to monitor groundwater use and what mix of supply- and demand-side mechanisms to adopt to sa...

This paper proposes a new information-based method to calibrate the shadow values of constraints in Positive Mathematical Programming models of agricultural supply. Shadow values are chosen so as to minimise model deviation from observed activity- and input-specific expenditures, enhancing the informational basis of the calibrated model. We provide...

We present a vessel and target-specific positive mathematical programming model (PMP) for Hawaii's longline fishing fleet. Although common in agricultural economics, PMP modeling is rarely attempted in fisheries. To demonstrate the flexibility of the PMP framework, we separate tuna and swordfish production technologies into three policy-relevant fi...

The San Joaquin Valley—California’s largest agricultural region, and an important contributor to the nation’s food supply—is in a time of great change and growing water stress. Agriculture is a leading economic driver and the predominant water user. The region’s farms and related manufacturing businesses account for 25 percent of the valley’s reven...

In 2014 California passed legislation requiring the sustainable management of critically overdrafted groundwater basins, located primarily in the Central Valley agricultural region. Hydroeconomic modeling of the agricultural economy, groundwater, and surface water systems is critically important to simulate potential transition paths to sustainable...

This paper presents ideas for a new generation of agricultural system models that could meet the needs of a growing community of end-users exemplified by a set of Use Cases. We envision new data, models and knowledge products that could accelerate the innovation process that is needed to achieve the goal of achieving sustainable local, regional and...

We review the current state of agricultural systems science, focusing in particular on the capabilities and limitations of agricultural systems models. We discuss the state of models relative to five different Use Cases spanning field, farm, landscape, regional, and global spatial scales and engaging questions in past, current, and future time peri...

Agricultural systems science generates knowledge that allows researchers to consider complex problems or take informed agricultural decisions. The rich history of this science exemplifies the diversity of systems and scales over which they operate and have been studied. Modeling, an essential tool in agricultural systems science, has been accomplis...

Soil salinity accumulation in California’s Central Valley and other irrigated areas around the world affects agricultural productivity, regional economies, urban areas, and the environment. The direct costs of salinity to agriculture in the California’s Central Valley have been estimated to be equal to US$ 500 million per year. Reduced crop yields...

Standard hydroeconomic policy models are usually applied to areas in the world where precipitation is very low and crops are fully irrigated. As such, these models pool the annual stored precipitation plus other water supplies and assume that this total water supply can be allocated by time and place. This water pooling approach treats precipitatio...

As in many places, groundwater in California (USA) is the major alternative water source for agriculture during drought, so groundwater’s availability will drive some inevitable changes in the state’s water management. Currently, agricultural, environmental, and urban uses compete for groundwater, resulting in substantial overdraft in dry years wit...

Water markets form differently across the western United States, depending on the relative importance of water supply uncertainty and impediments to water transfers. In many locations, trades take the form of short-term leases of water, allowing the underlying property rights to remain unaffected. In other regions, water right transfers predominate...

Over the past 15 years water markets in California have evolved, but not as fast as expected, and not between the agents who were initially expected to be active in the market. The chapter reviews the disappointing performance of the state-sponsored groundwater bank in the 2009 drought and advances some hypotheses as to why the trades were not larg...

Concern about water scarcity and adverse climate events over agricultural regions have motivated a number of efforts to develop operational integrated hydro-economic models to guide adaptation and optimal use of water. Once calibrated, these models are used for water management and analysis assuming they remain valid under future conditions. In thi...

Sea level rise, large-scale flooding, and new conveyance arrangements for water exports may increase future water salinity for local agricultural production in California's Sacramento-San Joaquin Delta. Increasing salinity in crop root zones often decreases crop yields and crop revenues. Salinity effects are nonlinear, and vary with crop choice and...

Hydroelectric power plants can quickly and inexpensively respond to changes in electricity demand. However, this operational flexibility can cause negative environmental impacts and these environmental effects are mitigated through direct restrictions on hydropower operations, rather than taxes or other marketbased mechanisms. A dynamic model of hy...

This review critically looks at the theoretical and empirical foundations of positive mathematical programming and its evolution in the past decade or so. We show how the need to model new empirical phenomena has induced the literature to rethink model specifications and to address new questions in the area of calibrated programming. We also raise...

This paper presents an agroeconomic approach to assess the economic impact of improving nitrogen and irrigation management practices in California's Tulare Lake Basin and the Salinas Valley. The approach employs a self-calibrated mathematical programming model with a constant elasticity of substitution production function and two nests: one for irr...

Recurring droughts pose predictable challenges to water resources management in California. Disparities in water demand and supply over both space and time, fast-growing cities, prominent agriculture, and increasing concerns on maintaining and improving habitat for native species are among the most salient challenges to water allocation in the stat...

This paper describes calibration methods for models of agricultural production and water use in which economic variables can directly interact with hydrologic network models or other biophysical system models. We also describe and demonstrate the use of systematic calibration checks at different stages for efficient debugging of models. The central...

This paper develops an approach to select models that can make the best use of limited micro-level data sets to estimate production function parameters. Since production is often the core of the agricultural and environment policy analyses, we evaluate the models using criteria that reflect the objectives of policy analysis. We argue that policy pr...

This paper summarizes a comprehensive examination of the current and likely future of California's water resource system, as well as promising long-term directions for policy and management. Long-term challenges include declining state and federal resources, climate changes, population growth, and continued disruptions of native ecosystems. Improve...

Recent research suggests that regional hydrologic and economic implications should be considered before adopting policies encouraging efficient irrigation technology. Investigating regional effects of irrigation efficiency investments relies on predicting how farmers will adopt irrigation technology and practices in response to different water mana...

This paper presents a linked hydro-economic model and uses it to examine the regional effects of water use regulations and product price changes on the agriculture of the São Francisco River Basin, Brazil. The effects of weather on surface water availability are explicitly addressed using the hydrological model MIKE-Basin. Farmers’ adjustments to c...

Abstract Over the last 25 years, economic water policy models have evolved in concept, theoretical and technical methods, scope and application to address a host of water demand, supply, and management policy questions. There have been a number of theoretical and empirical advances over this period, particularly related to estimation of nonmarket,...

California agriculture is driven by the interactions between technology, resources, and market demands. Future production is a balance between the rates of change in these variables and environmental factors including climate change. With tight statewide water supplies and agriculture being an important part of the California economy, quantifying t...

In arid regions, including Australia's Murray-Darling basin and California's Central Valley, increasing salinity is a problem affecting agriculture, regional economies, urban areas, and the environment. The direct costs of salinity to agriculture in the Murray-Darling basin and California’s Central Valley are on the order of $500 million per year....

Water markets form dierently across the western United States, depending on the relative importance of water supply uncertainty and impediments to water transfers. In many locations, trades take the form of short-term leases of water, where the underlying property rights remain unaected. In other regions, water right transfers predominate. A theore...

We present an analytical approach to assess the economic impact of improving nitrogen management practices in California agriculture. We employ positive mathematical programming to calibrate crop production to base input information. The production function representation is a nested constant elasticity of substitution with two nests: one for appli...

This paper evaluates the farm-level supply and income effects from removing milk quotas and reducing producer prices with increasing direct compensatory payments. Using a panel of Belgian dairy farms, we first estimate a multi-output multi-input flexible cost function that generates a U-shaped marginal cost curve for each farm of the sample. We the...

Agriculture in the Central Valley of California, one of the USA’s main sources of fruits, nuts, and vegetables, is highly vulnerable to climate change impacts in the next 50 years. This interdisciplinary case study in Yolo County shows the urgency f or building adaptation strategies to climate change. Although climate change and the effects of gree...

Positive Mathematical Programming (PMP) models of agricultural supply have been popularised by Howitt (1995b) and used extensively in policy analysis, to predict the response of agricultural systems facing resource, technology and policy constraints to exogenous shocks. The models are typically calibrated against observed regional—e.g., in the U.S....

Replaced with revised version of paper 07/19/11.

Replaced with revised version of paper 07/24/11.

The goal of this paper is to analyze whether reforming groundwater pricing has the potential to encourage water conservation and assess its impacts on crop production and producer income in rural China. Household-level water demands are estimated so that adjustments at both the intensive and extensive margins are captured. The results show that a l...

This article is the first of its kind to estimate econometrically the supply elasticity of California wine grapes. Wine grapes constitute the single largest crop in the state of California in terms of total receipts. Allowing for the dynamic adjustments of quasi-fixed inputs, we estimate simultaneous systems of equations for California's four major...

The Sacramento-San Joaquin Delta moves water from Northern California watersheds to farmlands and cities south and west of the Delta. Recent water exports from the Delta have ranged from 5 to 6 million acre-feet per year, supplying much of the water used in the Bay Area, the southern Central Valley, and Southern California. This chapter discusses t...

Before the European settlement, Sacramento-San Joaquin Delta was one of California's most dynamic landscapes. Today's Delta is unstable and has significantly changed from its historic condition. It faces inevitable changes in landscape, economy, and ecology, driven by land subsidence, changing inflows, sea-level rise, earthquakes, and biological in...

The European settlement in the Sacramento-San Joaquin Delta resulted in the transformation of forested areas and vegetation into agricultural sites and urban communities. Vast areas of tidal wetlands were converted into farmlands surrounded by levees. This chapter presents the history and foundations of the modern delta economy. It describes the ge...

This chapter estimates the costs of different approaches to managing Delta exports and outflows from the perspectives of both water supply and quality. It begins by discussing statewide adaptations to Delta water management and then assesses the costs of increasing Delta outflows and estimates the economic value of expanding water management facili...

Sea-level rise, earthquakes, land subsidence, and higher winter flood flows increase the risks of Delta island failures and the costs of preventing and recovering from failures. To solve these problems, California's Sacramento-San Joaquin Delta will require governance, regulatory, and financial mechanisms and institutions that allow firm decisions...

California needs effective political leadership, a sound governance and finance system, and an appropriate set of regulatory tools to chart a new course for Delta management. This chapter provides an overview of financing and mitigation options and models for regional land management. It also focuses on the governance issue of providing safeguards...

This chapter presents recent scientific and technical findings and assessments to evaluate Delta export management strategies with respect to the environmental and water supply objectives for the Delta, measured in terms of native fish population viability and statewide economic costs of water supply. It employs formal decision analysis, incorporat...

This chapter examines the effects of physical changes in the Delta and different water management alternatives on Delta salinity. It uses hydrodynamic modeling tools to explore the effects of sea-level rise, island flooding, and changes in water management. The water analysis module (WAM) is used to examine the effects of sea-level rise and of Delt...

Over the last decade, fish populations in the Sacramento-San Joaquin Delta ecosystem has substantially declined. In the Delta, the water allocation strategy has resulted in a diminishing proportion of the water being made available for fish or ecosystem needs. This chapter addresses whether alternatives to the present through-Delta pumping strategy...

The California wine industry has been in the midst of a prolonged boom for more than 30 years. In 1975, California was home to approximately 330 wineries; by 2006 there were nearly 2,500. There has been a dramatic shift in demand toward higher priced and higher quality table wines, as reflected in the total revenues and crush shares of the state's...

In this paper a high-resolution linked hydroeconomic model is demonstrated for drought conditions in a Brazilian river basin. The economic model of agriculture includes 13 decision variables that can be optimized to maximize farmers' yearly net revenues. The economic model uses a multi-input multioutput nonlinear constant elasticity of substitution...

Given the high proportion of water used for agriculture in certain regions, the economic value of agricultural water can be an important tool for water management and policy development. This value is quantified using economic demand curves for irrigation water. Such demand functions show the incremental contribution of water to agricultural produc...

Future water management will shift from building new water supply systems to better operating existing ones. The variation of water values in time and space will increasingly motivate efforts to address water scarcity and reduce water conflicts. Hydro-economic models represent spatially distributed water resource systems, infrastructure, management...

This paper applies two-stage stochastic quadratic programming to optimize conjunctive use operations of groundwater pumping and artificial recharge with farmer’s expected revenue and cropping decisions. The two-stage programming approach allows modeling of water and permanent crop production decisions, with recourse for uncertain conditions of hydr...

Infectious animal diseases are an ever-present threat to intensive livestock production. We analyzed control technology for foot-and-mouth disease (FMD) in a livestock-intensive region of the Central Valley, using a previously developed, numerical, optimal disease-control model. We found that the alternative FMD controls we studied (early detection...

This paper uses simple hydro-economic optimization to investigate a wide range of regional water system management options for northern Baja California, Mexico. Hydro-economic optimization models, even with parsimonious model formulations, enable investigation of promising water management portfolios for supplying water to agricultural, environment...

The Sacramento-San Joaquin Delta is the hub of California's water supply system and the home of numerous native fish species, five of which already are listed as threatened or endangered. The recent rapid decline of populations of many of these fish species has been followed by court rulings restricting water exports from the Delta, focusing public...

Agricultural management has a significant impact on the amount of greenhouse gases emitted by cropped fields. Alternative practices such as winter cover cropping and avoiding overfertilization can decrease the total amount of greenhouse gases that are produced. Policymakers are considering a structure in which parties (such as factories) who exceed...

Carbon sequestration in agricultural land has been studied over the past few years to determine its potential for ameliorating climate change, Agricultural soils can be efficiently exploited as carbon sinks with a variety of techniques, such as reduced tillage, cover cropping and organic systems with better manure management. However, to fully unde...

Irrigated agriculture is the largest water user in many regions, and agricultural water use efficiency and consumption has been studied by several authors. This paper provides a framework and application of economic valuation of water for agriculture in three regions in northern Baja California, Mexico, namely Guadalupe, Maneadero and Mexicali Vall...

Irrigated agriculture is the largest water user in many regions, and agricultural water use efficiency and consumption has been studied by several authors. This paper provides a framework and application of economic valuation of water for agriculture in three regions in northern Baja California, Mexico, namely Guadalupe, Maneadero and Mexicali Vall...

This article uses a basin-wide hydrologic model to assess the hydrologic and economic effects of expanding agriculture in the São Francisco River Basin, Brazil. It then uses a basin-wide economic model of agriculture to examine the effects of implementing water use regulations. Preliminary results suggest that substantially expanding agriculture wo...

The main objective of this paper is to design and test a decentralized exchange mechanism that generates the location-specific pricing necessary to achieve efficient allocations in the presence of instream flow values. Although a market-oriented approach has the potential to improve upon traditional command and control regulations, questions remain...

Irrigated agriculture is the largest water user in many regions, and agricultural water use efficiency and consumption has been studied by several authors. This paper provides a framework and application of economic valuation of water for agriculture in three regions in northern Baja California, Mexico, namely Guadalupe, Maneadero and Mexicali Vall...

California's complex water management system often defies comprehensive analysis. We summarize the results of a decade of quantification and analysis of this system from a hydro-economic perspective using the CALVIN Model. The general approach taken dates back to Roman times, when Frontinus (97 AD) began his oversight of Rome's water system with a...

A Report Prepared for the Border Affairs Unit of the California Environmental Protection Agency. Policy Implications Seven major policy implications arise from this work: 1. Baja California faces water supply challenges for agricultural, environmental and urban uses. Large economic losses will occur without major water supply improvements. 2. Water...

Policymakers have been charged with the efficient, equitable, and sustainable use of water resources of the São Francisco River Basin (SFRB), Brazil, and also with the promotion of economic growth and the reduction of poverty within the basin. To date, policymakers lack scientific evidence on the potential consequences for growth, poverty alleviati...

Policymakers, managers of water use associations, and many others in developing countries are considering policy actions that will directly or indirectly increase the costs of groundwater and surface water for agricultural users. While in many cases such actions may bring about welcomed increases in water use efficiency, little is known about the l...

This paper explores the likely impact of different estimation methods in key components of hydro-economic models such as hydrology and economic costs or benefits, using the CALVIN hydro-economic optimization for water supply in California. In perform our analysis using two climate scenarios: historical and warm-dry. The components compared were per...

1] A regional hydroeconomic model is developed to include demand shifts from nonprice water conservation programs as input parameters and decision variables. Stochastic nonlinear programming then jointly identifies the benefit-maximizing portfolio of conservation and leak reduction programs, infrastructure expansions, and operational allocations un...

This paper develops an approach to select models that can use limited micro-level data sets most efficiently to estimate production function parameters. Since production is often the core of the agricultural and environment policy analyses, we evaluate the models using criteria that reflect the objectives of policy analysis. We argue that policy pr...

The northern border of Baja California hosts prominent agriculture and fast-growing cities under an extreme-arid climate. This paper provides an economic-engineering analysis of water supply alternatives to cope with agricultural, environmental and urban water needs projected to year 2025. Analysed alternatives include idealised water markets, wast...

This paper describes a hydro-economic analysis of agricultural, environmental and urban water supply alternatives for years 2025 and 2080, in Baja California. Alternatives include idealized water markets, wastewater reuse, seawater desalination and infrastructural expansions. A network of the water system was built to considering hydrology, agricul...

Economically optimal operational changes and adaptations for California’s water supply system are examined for a dry form of climate warming (GFDL CM2.1 A2) with year 2050 water demands and land use. Economically adaptive water management for this climate scenario is compared to a similar scenario with the historical climate. The effects of populat...

This paper evaluates the farm level supply and income effects from removing milk quotas and reducing producer prices with increasing direct compensatory payments. Using a panel of Belgian dairy farms, we first estimate long-run flexible multioutput multi-input marginal cost curves for each farm of the sample. Second, we embed each estimated long-ru...

Reliability of supply is an important issue facing water agencies in arid regions throughout the western US, due to variation in natural precipitation from year to year. Water transactions in the western US often reflect the stochastic nature of water availability. When constructing a hydroeconomic model, first is the question of how to incorporate...

The primary purpose of this paper is to provide updated estimates of domestic own-price, cross-price and income elasticities of demand and estimated price elasticities of supply for various California commodities. Flexible functional forms including the Box-Cox specification and the nonlinear almost ideal demand system are estimated and bootstrap s...

This paper employs an economic-engineering optimization model to explore water supply options for environmental restora-tion of the Colorado River Delta, Mexico. Potential water sources include reductions in local agricultural and urban water use through water markets, wastewater reuse, and additional Colorado River flows from the United States. Fo...

The large, complex water systems throughout the world, including the Western U.S., have traditionally required a centralized authority both to solve their fundamental coordination problems and to dictate solutions to their allocation issues. These problems are often exacerbated by factors such as the public good nature of water, externalities assoc...

Most of the discussion of water markets revolves around the concept of trading permanent water rights, which implicitly assumes that the water property rights are adequately defined and transaction costs are not a significant barrier to trade. While this situation is relevant to several countries and areas in the U.S., there are many other regions...

Groundwater discharge through evaporation due to a shallow water table can be an important component of a regional scale water balance. Modeling this phenomenon in irrigated regions where soil moisture varies on short time scales is most accurately accomplished using variably saturated modeling codes. However, the computational demands of these mod...

A dynamic optimization model was developed and used to evaluate alternative foot-and-mouth disease (FMD) control strategies. The model chose daily control strategies of depopulation and vaccination that minimized total regional cost for the entire epidemic duration, given disease dynamics and resource constraints. The disease dynamics and the impac...

A dynamic optimization model was used to search for optimal strategies to control foot-and-mouth disease (FMD) in the three-county region in the Central Valley of California. The model minimized total regional epidemic cost by choosing the levels of depopulation of diagnosed herds, preemptive depopulation, and vaccination. Impacts of limited carcas...

Information on the spatial distribution of poverty can be useful in designing geographically targeted rural poverty reduction programs. This paper uses recently released município-level data on rural poverty in Brazil to identify and analyze spatial patterns of rural poverty in the São Francisco River Basin (SFRB). Moran’s I statistics are gener...