Regulating Nitrogen Pollution with Risk Averse Farmers under Hidden Information and Moral Hazard
构建了一个包含风险规避农户、隐藏信息和道德风险的氮污染监管模型，利用法国作物生产数据估计并模拟最优合同，为设计激励相容的污染监管政策提供参考。
We consider a model of pollution regulation for a risk averse farmer involving hidden information, moral hazard, and risk‐sharing. The representative farmer faces a production risk originating from nitrogen leaching, and privately observes the soil capacity in retaining nitrogen only after the regulation contract is signed. The latter specifies a transfer and a nitrogen quota, whose decomposition by the farmer among different production stages is unknown to the regulator. We first characterize the optimal solution to the regulator's problem. The sequential decision model is estimated on French crop production data, and the results are used to calibrate and simulate the optimal contract.