There is growing interest in using environmental taxes to address the problems of agricultural pesticide contamination, given the potential of economic instruments for higher eciency compared to regulatory approaches. However, research to date has suggested low producer responsiveness to input price changes. It is important to examine crop protection decisions and the options for adjustment in more detail. A case-study arable farm model is presented to evaluate the implications of new, currently experimental, low-input farming production systems for pesticide policy. If producers adhere to current systems, a pesticides tax at politically acceptable levels introduced as a stand-alone measure would perform poorly. Consistent with a number of studies, the model suggests that pesticide use levels could be reduced signi®cantly while actually increasing farm income levels through conversion to lowinput farming. Pesticide taxation cannot be viewed in isolation as a policy tool but should be part of a package of measures, including in particular education and training to encourage and assist farming system change. # 2000 Elsevier Science Ltd. All rights reserved.
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