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An Empirical Structural Model of Productivity and Conservation Reserve Program Participation

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  • Heesun Jang
  • Xiaodong Du

Abstract

The Conservation Reserve Program (CRP), which provides incentives for landowners to idle erodible and marginal farmland, faced new challenges as record-high commodity prices significantly affected landowners’ interests in the program in recent years. We develop and estimate an empirical structural model to examine the manner in which productivity, market conditions, and CRP payment affect landowners’ land use decisions. The model carefully controls for the endogeneity of CRP payment and landowners’ self-selection into the program. The parameter estimates are used to simulate how changes in agricultural prices and CRP payment influence program enrollment and cost across the Corn Belt states.

Suggested Citation

  • Heesun Jang & Xiaodong Du, 2018. "An Empirical Structural Model of Productivity and Conservation Reserve Program Participation," Land Economics, University of Wisconsin Press, vol. 94(1), pages 1-18.
    • Handle: RePEc:uwp:landec:v:94:y:2018:i:1:p:1-18
    Note: DOI: 10.3368/le.94.1.1
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    Citations

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    Cited by:

    1. Long, Kaisheng & Omrani, Hichem & Pijanowski, Bryan C., 2020. "Impact of local payments for ecosystem services on land use in a developed area of China: A qualitative analysis based on an integrated conceptual framework," Land Use Policy, Elsevier, vol. 96(C).
    2. Joshua M. Duke & Robert J. Johnston & Amy L. Shober & Zhongyuan Liu, 2023. "Improving targeting of farmers for enrollment in agri‐environmental programs," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 45(2), pages 1072-1096, June.
    3. Assogba, Noel Perceval & Zhang, Daowei, 2022. "The conservation reserve program and timber prices in the southern United States," Forest Policy and Economics, Elsevier, vol. 140(C).
    4. Ram K. Adhikari & Robert K. Grala & Stephen C. Grado & Donald L. Grebner & Daniel R. Petrolia, 2022. "Landowner Satisfaction with Conservation Programs in the Southern United States," Sustainability, MDPI, vol. 14(9), pages 1-23, May.
    5. Heesun Jang & Hyunhee Kim & Hojeong Park, 2020. "Spatiotemporal analysis of Korean ginseng farm productivity," Journal of Productivity Analysis, Springer, vol. 53(1), pages 69-78, February.
    6. Oladipo S. Obembe & Nathan P. Hendricks, 2022. "Marginal cost of carbon sequestration through forest afforestation of agricultural land in the southeastern United States," Agricultural Economics, International Association of Agricultural Economists, vol. 53(S1), pages 59-73, November.
    7. Adjei, Eugene & Zhang, Jingfang & Sawadgo, Wendiam & Li, Wenying, 2022. "The Effect of Payment–for–Ecosystem Services on CRP Land Enrollment: A Nonlinear Regime-Switching Approach," 2022 Annual Meeting, July 31-August 2, Anaheim, California 322344, Agricultural and Applied Economics Association.
    8. Sergei Schaub & Jaboury Ghazoul & Robert Huber & Wei Zhang & Adelaide Sander & Charles Rees & Simanti Banerjee & Robert Finger, 2023. "The role of behavioural factors and opportunity costs in farmers' participation in voluntary agri‐environmental schemes: A systematic review," Journal of Agricultural Economics, Wiley Blackwell, vol. 74(3), pages 617-660, September.
    9. Thilo W. Glebe, 2022. "The influence of contract length on the performance of sequential conservation auctions," American Journal of Agricultural Economics, John Wiley & Sons, vol. 104(2), pages 739-764, March.
    10. Brian Cornish & Ruiqing Miao & Madhu Khanna, 2022. "Impact of changes in Title II of the 2018 Farm Bill on the acreage and environmental benefits of Conservation Reserve Program," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 44(2), pages 1100-1122, June.

    More about this item

    JEL classification:

    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • Q15 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Land Ownership and Tenure; Land Reform; Land Use; Irrigation; Agriculture and Environment

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