Precision Farming and Emissions Trading
Scrappad has an interesting post on precision agriculture, plus some interesting elaboration by Vector One.
Since fertilizer often affects water quality, I wonder if it might make sense to create a market such that there is a cap on the total amount of fertilizer allowed by watershed. Then a market could be opened that allows farmers within a watershed to buy and sell fertilizer permits. This is similar to the concept of emmissions trading, but with the added spatial dimensions of watershed flow relationships. It seems like this would allow market forces to optimize the spatial distribution of fertilizer.
I think they’re already tracking fertilizer pretty closely here in the US, ever since the bombing of the Murrah building, so there’s already a bureaucracy in place.