Quantifying the Water Quality Impacts of Cropland Farming in China: A Satellite Data Approach

Abstract We compile a unique satellite‐derived panel dataset to investigate the impacts of cropland coverage on the outbreak of Harmful Algal Blooms (HABs) in China between 2003 and 2019. Our results indicate that a 1% increase in cropland leads to a 0.5% increase in the size of HABs in lakes larger than 20 km 2 . The increase in cropland not only affects the size of HABs but also significantly prolongs their duration on average. Furthermore, we provide evidence of a diminishing legacy effect of cropland on HAB area over time and a nonlinear relationship between cropland area and HABs. Fertilizer leakage from cropland shapes the entire pollution mechanism, with farming practices that require elevated fertilizer posing significantly greater impacts on water quality. While the nationwide fertilizer reduction policy implemented in 2015 successfully dampens HABs in nonreservoir lakes during the initial three years, its long‐term effects remain uncertain. This study highlights the potential of satellite imagery data for economic analyses of nutrient pollution in China.