I know almost nothing about this (aside from having heard programs mention the problem, and now having read this and a few sources on it), but I’ll just semi-casually remark that it seems like a major/central problem here is that a negative externality is not priced into the market whereas if it were priced in via taxation (perhaps to partially fund a rebate similar to the first proposal mentioned) the problem would be largely fixed—but that political resistance prevents such a standard economic policy response, to the net detriment of the country/people. Thus, a lot of the solutions seem to be about how to find ways around that political resistance, even if not so explicitly.But I could be wrong, and that’s where I wanted to ask/clarify: are there also substantial problems with enforcement/verification? Are there other market failures (e.g., a bloated supply with poor people that would struggle deal with frictional unemployment and/or who are not really skilled enough to get work elsewhere)?
Ultimately, I just wonder if the most efficient solution would be primarily just “tax and (partial) rebate”; if the barrier to that is “farmers are a major voting block and thus can impose costs on others”, is it not possible to just find a political compromise (e.g., are there any similar situations where non-farmers impose externalities on farmers)?
(I’m absolutely not knowledgeable on Indian politics, I’m just curious/thinking)
I’m also not knowledgeable about Indian politics, but it seems pretty clear that Indian farmers wield considerable political influence. (See the reaction to the introduction of three market-friendly farm laws for the most recent demonstration of this power.) I’d like to think political compromise is possible, but it’s hard to know which compromises are feasible.
Fortunately, it appears that many of the potential solutions to stubble burning are essentially win-win. Although stubble burning is an effective way to deal with crop residue in the short term, the practice is pretty bad for the soil. Many of the alternatives to stubble burning would probably raise yields in the long-run.
Although stubble burning is an effective way to deal with crop residue in the short term, the practice is pretty bad for the soil.
For one, you lose the nitrogen in the residue to the air through burning. With all the cattle in India, I would think you could just feed the residue to them, and this says it could make up about 50% of their diet. And you might be able to grab some human edible calories first through the leaf protein concentrate process. There is also cellulosic ethanol or cellulosic sugar, though those are likely not economical now.
Thanks for the suggestions! Anyone who works on this topic in the future should probably investigate them further. My current rough impression is that, even if there were a market for the stubble, the process of baling the stubble for transport and sale would either be time-and-labor intensive or require equipment that the average farmer in the region can’t afford. Because of the nature of the crop cycle, farmers are under intense pressure to clear the stubble quickly, hence the appeal of stubble burning.
Again, I’m not super knowledgeable of the situation and/or the proposals, but to draw on a bit of economist/libertarian thought by cross-applying concepts from other, similar situations (e.g., pollution externalities): I would be hesitant to describe many of the (likely-impactful) solutions as truly “win-win.” Proposals 1 and 2 clearly (and sort of/potentially proposals 3 and 5) are subsidies that help farmers at the expense of everyone else. Yes, it may be the case that the “city folk” would benefit from less pollution, but they would have to bear a (likely heavy) portion of the tax burden to fund that—all to stop pollution which is imposing non-consensual, uncompensated harms on them in the first place. So, it might be true if proposal 1 works at reducing pollution it’s a “better-better” situation than doing nothing, but (to put it dramatically) that’s vaguely akin to saying “paying off the mafia for protection is a win-win, since the mafia makes money and they don’t smash stores.”
Toning it down a bit: that’s not to say they are necessarily bad proposals, or that such solutions (even when less than ideal) are not the best politically feasible options. But I am slightly curious to see more evidence about the market dynamics of the situation: if political feasibility were not a limitation, what would be the optimal response? Starting with the simple, econ 101⁄102 approach: If stubble burning is really so bad for the farmers, it begs the question why they don’t just cease the practice on their own. It seems the obvious answer is “because those benefits are still less than the cost of not burning”; as a matter of 101/102-level (i.e., simplistic) economics, the response to that should be “raise prices and either compensate people for the damage you impose on them through pollution or stop doing the pollution.” This I think is where market failures probably step onto the stage to wrinkle things… but I only have a narrow slice of experience with ag policy, and it isn’t this topic, so I’ll just leave my rambling at that.
Hey Harrison, I think the short answer is that it’s just a really messy situation and any potential solution that has a shot at improving on the status quo has to take political reality into account.