26 Agricultural Harm to the Environment
are not included in prices, they distort the market by encouraging activities that are
costly to society even if the private benefits are substantial. The types of externalities
encountered in the agricultural sector have several features. Their costs are often
neglected, and frequently occur with a time lag. They often damage groups whose
interests are not represented, and the identity of the producer of the externality is
not always known.^8
In practice, there is little agreed data on the economic cost of agricultural
externalities. This is partly because the costs are highly dispersed and affect many
sectors of economies. It is also necessary to know about the value of nature’s goods
and services, and what happens when these largely unmarketed goods are lost. As
the current system of economic accounting grossly underestimates the current and
future value of natural capital, this makes the task even more difficult.^9 It is rela-
tively easy, for example, to count the treatment costs following pollution, but
much more difficult to value, for example, skylarks singing on a summer’s day, and
the costs incurred when they are lost.
Several studies have recently put a cost on the negative externalities of agricul-
ture in China, Germany, The Netherlands, the Philippines, the UK and the US.^10
When it is possible to make the calculations, our understanding of what is the best
or most efficient form of agriculture can change rapidly. In the Philippines,
researchers from the International Rice Research Institute (IRRI) found that mod-
ern rice cultivation was costly to human health. They investigated the health status
of rice farmers exposed to pesticides, and estimated the monetary costs of signifi-
cantly increased incidence of eye, skin, lung and neurological disorders. By incor-
porating these into the economics of pest control, they found that modern,
high-pesticide systems suffer twice, as with nine pesticide sprays per season they
returned less per hectare than the integrated pest management strategies, and cost
the most in terms of ill health. Any expected positive production benefits of apply-
ing pesticides were overwhelmed by the health costs. Rice production using natu-
ral control methods has multifunctionality in contributing positively both to
human health as well as sustaining food production.^11
At the University of Essex, we recently developed a new framework to study
the negative externalities of UK agriculture. This uses seven cost categories to assess
negative environmental and health costs – damage to water, air, soil and biodiver-
sity, and damage to human health by pesticides, microorganisms and disease
agents. The analysis of damage and monitoring costs counted only external costs,
as private costs borne by farmers themselves, such as from increased pest or weed
resistance from pesticide overuse, are not included. We conservatively estimated
that the external costs of UK agriculture, almost all of which is modernized and
industrialized, to be at least £1½–2 billion each year. Another study by Olivia
Hartridge and David Pearce has also put the annual costs of modern agriculture in
excess of £1 billion.^12 These are costs imposed on the rest of society, and effectively
a hidden subsidy to the polluters.^13 The annual costs arise from damage to the
atmosphere (£316 million), to water (£231 million), to biodiversity and land-
scapes (£126 million), to soils (£96 million) and to human health (£777 million).