CAFOs and Surface Water Quality: Evidence from Wisconsin

67 Pages Posted: 13 May 2019 Last revised: 29 Jan 2021

See all articles by Zach Raff

Zach Raff

University of Wisconsin - Stout

Andrew Meyer

Marquette University

Date Written: April 18, 2019

Abstract

Concentrated Animal Feeding Operations (CAFOs) – animal feeding operations with over 1,000 animal units in confined spaces – have proliferated over the past 30 years in the United States. CAFOs provide operational cost savings, but higher animal concentrations in confined spaces can generate external costs, e.g., non-point source water pollution. In this study, we improve on previous research designs to estimate the relationship between the growth in CAFOs and surface water quality using longitudinal data on a large spatial scale. We use a panel dataset from 1995-2017 that links CAFO intensity with nearby surface water quality readings in Wisconsin to perform our analysis. Leveraging variation in CAFO intensity within hydrological regions over time, we find that increasing CAFO intensity increases the levels of nutrients, specifically total phosphorus and ammonia, in surface water; adding one CAFO to a Hydrologic Unit Code-8 (HUC8) region leads to a 1.7% increase in total phosphorus levels and a 2.7% increase in ammonia levels, relative to sample mean levels. As an important contribution of our work, we use these results to calculate the external costs of surface water quality damages from CAFOs in Wisconsin. Our results imply that the marginal CAFO in Wisconsin produces non-market surface water quality damages of at least $203,541 per year.

Keywords: Concentrated Animal Feeding Operations, instrumental variables, non-point source pollution, surface water quality, total phosphorus

JEL Classification: H23, Q15, Q53

Suggested Citation

Raff, Zach and Meyer, Andrew, CAFOs and Surface Water Quality: Evidence from Wisconsin (April 18, 2019). Available at SSRN: https://ssrn.com/abstract=3379678 or http://dx.doi.org/10.2139/ssrn.3379678

Zach Raff (Contact Author)

University of Wisconsin - Stout ( email )

Menomonie , WI 54751
United States

Andrew Meyer

Marquette University ( email )

1225 W. Wisconsin Avenue
Milwaukee, WI 53233
United States
414-288-5489 (Phone)

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