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Land Retirement Program Design in the Presence of Crop Insurance Subsidies

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Author Info
David A. Hennessy () (Center for Agricultural and Rural Development (CARD))

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Abstract

The U.S. federal government implements environmental, biofuels and crop insurance programs that influence land use. They are not well integrated in that cost savings from crop insurance subsidies are not acknowledged when screening land for retirement or when calculating the cost of land retirement programs. We identify and evaluate an optimal benefit index for enrollment in a land retirement program that includes a sub-index to rank land according to insurance subsidy savings. All else equal, land ranked higher in the Lorenz stochastic order should be retired first.

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Publisher Info
Paper provided by Center for Agricultural and Rural Development (CARD) at Iowa State University in its series Center for Agricultural and Rural Development (CARD) Publications with number 09-wp495.

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Date of creation: Jul 2009
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Handle: RePEc:ias:cpaper:09-wp495

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Related research
Keywords: agro-environmental policy; budget; Conservation Reserve Program; crop failure; Environmental Benefit Index; Lorenz order.;

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Find related papers by JEL classification:
Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy
Q28 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Government Policy

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  1. Feng, Hongli & Kurkalova, Lyubov A. & Kling, Catherine L. & Gassman, Philip W., 2006. "Environmental conservation in agriculture: Land retirement vs. changing practices on working land," Journal of Environmental Economics and Management, Elsevier, vol. 52(2), pages 600-614, September. [Downloadable!] (restricted)
  2. Susan Athey, 2002. "Monotone Comparative Statics Under Uncertainty," The Quarterly Journal of Economics, MIT Press, vol. 117(1), pages 187-223, February. [Downloadable!] (restricted)
  3. Baylis, Kathy & Peplow, Stephen & Rausser, Gordon & Simon, Leo, 2008. "Agri-environmental policies in the EU and United States: A comparison," Ecological Economics, Elsevier, vol. 65(4), pages 753-764, May. [Downloadable!] (restricted)
  4. Bhavani Shankar & Richard Bennett & Stephen Morse, 2008. "Production risk, pesticide use and GM crop technology in South Africa," Applied Economics, Taylor and Francis Journals, vol. 40(19), pages 2489-2500. [Downloadable!] (restricted)
  5. Glenn Sheriff, 2005. "Efficient Waste? Why Farmers Over-Apply Nutrients and the Implications for Policy Design," Review of Agricultural Economics, American Agricultural Economics Association, vol. 27(4), pages 542-557, December. [Downloadable!] (restricted)
  6. J. K. Horowitz & E. Lichtenberg, 1994. "Risk-Reducing And Risk-Increasing Effects Of Pesticides," Journal of Agricultural Economics, Blackwell Publishing, vol. 45(1), pages 82-89. [Downloadable!] (restricted)
  7. George Baker, 2000. "The Use of Performance Measures in Incentive Contracting," American Economic Review, American Economic Association, vol. 90(2), pages 415-420, May. [Downloadable!] (restricted)
  8. Florent Bresson, 2009. "On The Estimation Of Growth And Inequality Elasticities Of Poverty With Grouped Data," Review of Income and Wealth, Blackwell Publishing, vol. 55(2), pages 266-302, 06. [Downloadable!] (restricted)
  9. Hurd, Brian H., 1994. "Yield Response And Production Risk: An Analysis Of Integrated Pest Management In Cotton," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 19(02), December. [Downloadable!]
  10. Robert Innes, 2003. "Crop Insurance in a Political Economy: An Alternative Perspective on Agricultural Policy," American Journal of Agricultural Economics, American Agricultural Economics Association, vol. 85(2), pages 318-335, 05. [Downloadable!] (restricted)
  11. Joseph W. Glauber, 2004. "Crop Insurance Reconsidered," American Journal of Agricultural Economics, American Agricultural Economics Association, vol. 86(5), pages 1179-1195, December. [Downloadable!] (restricted)
  12. Atkinson, Anthony B., 1970. "On the measurement of inequality," Journal of Economic Theory, Elsevier, vol. 2(3), pages 244-263, September. [Downloadable!] (restricted)
  13. Bhattacharya, Debopam, 2007. "Inference on inequality from household survey data," Journal of Econometrics, Elsevier, vol. 137(2), pages 674-707, April. [Downloadable!] (restricted)
  14. Wilfling, Bernd, 1996. "Lorenz ordering of power-function order statistics," Statistics & Probability Letters, Elsevier, vol. 30(4), pages 313-319, November. [Downloadable!] (restricted)
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