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Commodity Programs and the Internalization of Erosion Costs: Do They Affect Crop Rotation Decisions?

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  • Poe, Gregory L.
  • Klemme, Richard M.
  • McComb, Shawn J.

Abstract

Using stochastic dominance, this paper investigates the impact of commodity programs and internalization of erosion costs on crop rotation decisions. Commodity programs are found to shift decisions towards more erosive rotations. Internalization of erosion costs affect rotation decisions under historical market conditions but not under conditions of commodity program participation.

Suggested Citation

  • Poe, Gregory L. & Klemme, Richard M. & McComb, Shawn J., 1990. "Commodity Programs and the Internalization of Erosion Costs: Do They Affect Crop Rotation Decisions?," 1990 Annual meeting, August 5-8, Vancouver, Canada 270730, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
  • Handle: RePEc:ags:aaea90:270730
    DOI: 10.22004/ag.econ.270730
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    References listed on IDEAS

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    1. Parveen P. Setia & Gary V. Johnson, 1988. "Soil Conservation Management Systems Under Uncertainty," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 10(1), pages 111-124.
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    3. Meyer, Jack, 1987. "Two-moment Decision Models and Expected Utility Maximization," American Economic Review, American Economic Association, vol. 77(3), pages 421-430, June.
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    5. William J. Brown, 1987. "A Risk Efficiency Analysis of Crop Rotations in Saskatchewan," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 35(2), pages 333-355, July.
    6. D. Peter Stonehouse & J. K. Baffoe & B. D. Kay, 1987. "The Impacts of Changes in Key Economic Variables on Crop Rotational Choices on Ontario Cash-Cropping Farms," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 35(2), pages 403-420, July.
    7. Reichelderfer, Katherine H., 1985. "Do USDA Farm Program Participants Contribute to Soil Erosion?," Agricultural Economic Reports 307990, United States Department of Agriculture, Economic Research Service.
    8. Sandmo, Agnar, 1971. "On the Theory of the Competitive Firm under Price Uncertainty," American Economic Review, American Economic Association, vol. 61(1), pages 65-73, March.
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    Cited by:

    1. Gebremedhin, Berhanu & Schwab, Gerald, 1998. "The Economic Importance Of Crop Rotation Systems: Evidence From The Literature," Staff Paper Series 11690, Michigan State University, Department of Agricultural, Food, and Resource Economics.
    2. Poe, Gregory L., 1994. "Extra-Market Considerations in Farmland and Agricultural Policy," EB Series 186286, Cornell University, Department of Applied Economics and Management.
    3. Gebremedhin, Berhanu & Schwab, Gerald & Harwood, Richard R. & Christenson, Donald & Bricker, Calvin, 1998. "A Stochastic Dominance Analysis Of Alternative Sugar Beet- And Navy Bean- Based Crop Rotations In Michigan," Staff Paper Series 11509, Michigan State University, Department of Agricultural, Food, and Resource Economics.
    4. Poe, Gregory, 1997. ""Maximizing the Environmental Benefits per Dollar Expended" An Economic Interpretation and Review of Agricultural Environmental Benefits and Costs," EB Series 186405, Cornell University, Department of Applied Economics and Management.

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