Economic Valuation of Nitrogen Removal/Load of Cultivated Land by a New Replacement Cost Method

Abstract

Agriculture is multifunctional, and the value of each function should be expressed in a form that is easy for anyone to understand. One function, for example, is water purification, and recently much effort has been expended to quantify this function. We proposed a new replacement cost method to perform an economic valuation of the nitrogen (N) removal function of paddy fields and of the N load function of upland fields, as well as economically valuated cultivated lands in Japan. The N removal function was valued at approximately 0.3 JPY·m^-2·d^-1 when compared with the maintenance and depreciation cost of water quality improvement facilities. Upland fields have a negative economic value of approximately 0.08 JPY·m^-2·d^-1. However, paddy fields function effectively in N removal only when irrigation water is strongly contaminated with N. Consequently, 90% and more of the area used for paddy fields do not function in N removal. Based on these valuations, cultivated lands including paddy fields and upland fields could be annually valuated at minus 780×10⁹ JPY Japan-wide.