Spatial Dimensions of US Crop Selection: Recent Responses to Markets and Policy
AbstractWe explicitly measure corn acreage response to the biofuels boom from 2006 to 2010. Specifically, we use newly available micro-scale planting data over time to test whether corn cultivation intensifies in proportion to the proximity of ethanol processors. We control for the endogeneity of plant location to corn acreage by using transportation network data for instruments. Our results show that reducing the distance between a farm and an ethanol plant by one percent increases acreage in corn by 0.64% and reveal a price elasticity of supply of 0.47%. To our knowledge, this is the first study that measures changes in location and intensity of corn planting in response to incentives posed by the recent biofuels boom. The results can serve as a springboard for researchers and policy-makers concerned with crop diversity, environmental sustainability, and greenhouse gas emissions.
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Bibliographic InfoPaper provided by Agricultural and Applied Economics Association in its series 2011 Annual Meeting, July 24-26, 2011, Pittsburgh, Pennsylvania with number 103270.
Date of creation: 2011
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corn acreage; ethanol; panel data analysis; instrumental variables; Agricultural and Food Policy; Crop Production/Industries; Land Economics/Use; Q1; Q28; C33;
Find related papers by JEL classification:
- Q1 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture
- Q28 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Government Policy
- C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
This paper has been announced in the following NEP Reports:
- NEP-AGR-2011-05-07 (Agricultural Economics)
- NEP-ALL-2011-05-07 (All new papers)
- NEP-EFF-2011-05-07 (Efficiency & Productivity)
- NEP-ENV-2011-05-07 (Environmental Economics)
- NEP-GEO-2011-05-07 (Economic Geography)
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