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Slippage in the Conservation Reserve Program or Spurious Correlation? A Comment

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  • Michael J. Roberts
  • Shawn Bucholtz

Abstract

The Conservation Reserve Program (CRP) pays farmers about $2 billion per year to retire cropland under ten- to fifteen-year contracts. Recent research by Wu found that slippage—an unintended stimulus of new plantings—offsets some of CRP's environmental benefits. Wu does not account for the endogeneity of CRP enrollments. Furthermore, the data used by Wu cannot be used to estimate slippage arising from a price feedback effect. We replicate Wu's findings, demonstrate the possible presence of spurious correlation, and construct new estimates with corrections for endogeneity and other econometric problems. We find no convincing evidence of slippage. Copyright 2005, Oxford University Press.

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File URL: http://hdl.handle.net/10.1111/j.0002-9092.2005.00715.x
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Bibliographic Info

Article provided by Agricultural and Applied Economics Association in its journal American Journal of Agricultural Economics.

Volume (Year): 87 (2005)
Issue (Month): 1 ()
Pages: 244-250

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Handle: RePEc:oup:ajagec:v:87:y:2005:i:1:p:244-250

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Cited by:
  1. Ruben N. Lubowski & Andrew J. Plantinga & Robert N. Stavins, 2007. "What Drives Land-Use Change in the United States? A National Analysis of Landowner Decisions," NBER Working Papers 13572, National Bureau of Economic Research, Inc.
  2. Brady, Michael P. & Nickerson, Cynthia J., 2009. "A Spatial Analysis of Conservation Reserve Program Participants: The Impact of Absenteeism on Participation Decisions," 2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin 49369, Agricultural and Applied Economics Association.
  3. Andrew Manale & Cynthia Morgan & Glenn Sheriff & David Simpson, 2011. "Offset markets for nutrient and sediment discharges in the Chesapeake Bay Watershed: Policy tradeoffs and potential steps forward," NCEE Working Paper Series 201105, National Center for Environmental Economics, U.S. Environmental Protection Agency, revised Aug 2011.
  4. Chabé-Ferret, Sylvain & Subervie, Julie, 2012. "How Much Green for the Buck? Estimating Additional and Windfall Effects of French Agro-Environmental Schemes by DID-Matching," TSE Working Papers 12-357, Toulouse School of Economics (TSE).
  5. Claassen, Roger & Cattaneo, Andrea & Johansson, Robert, 2008. "Cost-effective design of agri-environmental payment programs: U.S. experience in theory and practice," Ecological Economics, Elsevier, vol. 65(4), pages 737-752, May.
  6. Taheripour, Farzad, 2006. "Economic Impacts of the Conservation Reserve Program: A General Equilibrium Framework," 2006 Annual meeting, July 23-26, Long Beach, CA 21346, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).

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