THE SUPPLY OF NON‐DEGRADED AGRICULTURAL LAND

Abstract

Profitability increases because of favourable product or factor price changes provide incentives for profit‐maximising farmers, who use soils in conjunction with other cooperant inputs, to increase their investment in the preservation of soil‐quality, whenever there exist economically viable technologies for preserving soils. However, when such technologies do not exist, regardless of whether farmers utilise soils as non‐renewable or renewable resources, such profitability increases are associated with a long‐run deterioration in soil quality. 1992 The Australian Agricultural Economics Society