Review of literature on economics and policy of carbon sequestration in agricultural soils

Abstract

PurposeThe purpose of this paper is to identify and describe key economic and policy‐related issues with regard to terrestrial C sequestration and provide an overview of the economics of C sequestration on agricultural soils in the USA.Design/methodology/approachRecent economic literature on carbon sequestration was reviewed to gather insights on the role of agriculture in greenhouse gas emissions mitigation. Results from the most salient studies were presented in an attempt to highlight the general consensus on producer‐level responses to C sequestration incentives and the likely mechanisms used to facilitate C sequestration activities on agricultural soils.FindingsThe likely economic potential of agriculture to store soil C appears to be considerably less than the technical potential. Terrestrial C sequestration is a readily implementable option for mitigating greenhouse gas emissions and can provide mitigation comparable in cost to current abatement options in other industries. Despite considerable research to date, many aspects of terrestrial C sequestration in the USA are not well understood.Originality/valueThe paper provides a useful synopsis of the terms and issues associated with C sequestration, and serves as an informative reference on the economics of C sequestration that will be useful as the USA debates future greenhouse gas emissions mitigation policies.