This file is part of IDEAS, which uses RePEc data


[ Papers | Articles | Software | Books | Chapters | Authors | Institutions | JEL Classification | NEP reports | Search | New papers by email | Author registration | Rankings | Volunteers | FAQ | Blog | Help! ]

Subsidy for Adopting Conservation Tillage: Estimation from Observed Behavior (The)

Author info | Abstract | Publisher info | Download info | Related research | Statistics
Author Info
Kurkalova, Lyubov A.
Kling, Catherine L.
Zhao, Jinhua

Additional information is available for the following registered author(s):

Abstract

Due to payoff uncertainties combined with risk aversion and/or real options, farmers may demand a premium in order to adopt conservation tillage practices, over and above the compensation for the expected profit losses (if any). We propose a method of directly estimating the financial incentives for adopting conservation tillage and distinguishing between the expected payoff and the premium of adoption based on observed behavior. We find that the premium may play a significant role in farmers' adoption decisions. Even for non-adopters, conservation tillage provides a higher payoff than does conventional tillage on average, as agronomists have argued. However, non-adopters do not use conservation tillage because the expected profit gain alone does not fully compensate them for the uncertainties. To induce additional adoption, subsidies could be used. We find that in Iowa on average, the mean subsidy needed is $2.40 per acre per year for corn and $3.50 per acre per year for soybeans.

Download Info
To download:

If you experience problems downloading a file, check if you have the proper application to view it first. Information about this may be contained in the File-Format links below. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://www.econ.iastate.edu/research/webpapers/paper_2007.pdf
File Format: application/pdf
File Function:
Download Restriction: no

Publisher Info
Paper provided by Iowa State University, Department of Economics in its series Staff General Research Papers with number 2007.

Download reference. The following formats are available: HTML (with abstract), plain text (with abstract), BibTeX, RIS (EndNote, RefMan, ProCite), ReDIF
Length:
Date of creation: 21 Sep 2001
Date of revision:
Handle: RePEc:isu:genres:2007

Contact details of provider:
Postal: Iowa State University, Dept. of Economics, 260 Heady Hall, Ames, IA 50011-1070
Phone: +1 515.294.6741
Fax: +1 515.294.0221
Email:
Web page: http://www.econ.iastate.edu
More information through EDIRC

For technical questions regarding this item, or to correct its listing, contact: (Stephanie Bridges).

Related research
Keywords:

Other versions of this item:

This paper has been announced in the following NEP Reports: References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Wu, JunJie & Babcock, Bruce A., 1996. "Choice of Tillage, Rotation, and Soil Testing Practices: Economic and Environmental Implications (The)," Staff General Research Papers 979, Iowa State University, Department of Economics. [Downloadable!]
    Other versions:
  2. Robert B. Barsky & Miles S. Kimball & F. Thomas Juster & Matthew D. Shapiro, 1997. "Preference Parameters and Behavioral Heterogeneity: An Experimental Approach in the Health and Retirement Survey," NBER Working Papers 5213, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  3. Soule, Meredith J & Tegene, Abebayehu & Wiebe, Keith D, 2000. " Land Tenure and the Adoption of Conservation Practices," American Journal of Agricultural Economics, American Agricultural Economics Association, vol. 82(4), pages 993-1005, November. [Downloadable!] (restricted)
  4. Uri, Noel D., 1998. "Conservation tillage and the use of energy and other inputs in US agriculture," Energy Economics, Elsevier, vol. 20(4), pages 389-410, September. [Downloadable!] (restricted)
  5. GR Pautsch & LA Kurkalova & BA Babcock & CL Kling, 2001. "The Efficiency Of Sequestering Carbon In Agricultural Soils," Contemporary Economic Policy, Western Economic Association International, vol. 19(2), pages 123-134, 04. [Downloadable!] (restricted)
  6. Paul D. Mitchell, 1997. "Cost of Production System Budgets," Center for Agricultural and Rural Development (CARD) Publications 97-tr37, Center for Agricultural and Rural Development (CARD) at Iowa State University. [Downloadable!]
  7. Barsky, Robert B, et al, 1997. "Preference Parameters and Behavioral Heterogeneity: An Experimental Approach in the Health and Retirement Study," The Quarterly Journal of Economics, MIT Press, vol. 112(2), pages 537-79, May.
  8. Moschini, GianCarlo & Hennessy, David A., 2002. "Uncertainty, Risk Aversion, and Risk Management for Agricultural Producers," Staff General Research Papers 5323, Iowa State University, Department of Economics.
    Other versions:
  9. Norris, Patricia E. & Batie, Sandra S., 1987. "Virginia Farmers' Soil Conservation Decisions: An Application Of Tobit Analysis," Southern Journal of Agricultural Economics, Southern Agricultural Economics Association, vol. 19(01), July. [Downloadable!]
  10. Arrow, Kenneth J & Fisher, Anthony C, 1974. "Environmental Preservation, Uncertainty, and Irreversibility," The Quarterly Journal of Economics, MIT Press, vol. 88(2), pages 312-19, May. [Downloadable!] (restricted)
  11. Bakshi, Gurdip S & Chen, Zhiwu, 1994. "Baby Boom, Population Aging, and Capital Markets," Journal of Business, University of Chicago Press, vol. 67(2), pages 165-202, April. [Downloadable!] (restricted)
  12. Cameron, Trudy Ann, 1988. "A new paradigm for valuing non-market goods using referendum data: Maximum likelihood estimation by censored logistic regression," Journal of Environmental Economics and Management, Elsevier, vol. 15(3), pages 355-379, September. [Downloadable!] (restricted)
  13. Pautsch, Gregory R. & Kurkalova, Lyubov A. & Babcock, Bruce A. & Kling, Catherine L., 2000. "Efficiency of Sequestering Carbon in Agricultural Soils (The)," Staff General Research Papers 1870, Iowa State University, Department of Economics. [Downloadable!]
    Other versions:
  14. Cooper, Joseph C., 1997. "Combining Actual And Contingent Behavior Data To Model Farmer Adoption Of Water Quality Protection Practices," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 22(01), July. [Downloadable!]
  15. Dimara, Efthalia & Skuras, Dimitrios, 1998. "Adoption of new tobacco varieties in Greece: Impacts of empirical findings on policy design," Agricultural Economics, Blackwell, vol. 19(3), pages 297-307, December. [Downloadable!] (restricted)
  16. Jianakoplos, Nancy Ammon & Bernasek, Alexandra, 1998. "Are Women More Risk Averse?," Economic Inquiry, Oxford University Press, vol. 36(4), pages 620-30, October.
  17. Allen M. Featherstone & Barry K. Goodwin, 1993. "Factors Influencing a Farmer's Decision to Invest in Long-Term Conservation Improvements," Land Economics, University of Wisconsin Press, vol. 69(1), pages 67-81. [Downloadable!] (restricted)
  18. Fuglie, Keith O., 1999. "Conservation Tillage And Pesticide Use In The Cornbelt," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 31(01), April. [Downloadable!]
  19. Claassen, Roger & Hansen, Leroy & Peters, Mark & Breneman, Vince & Weinberg, Marca & Cattaneo, Andrea & Feather, Peter & Gadsby, Dwight & Hellerstein, Daniel & Hopkins, Jeff & Johnston, Paul & Morehar, 2001. "Agri-Environmental Policy at the Crossroads: Guideposts on a Changing Landscape," Agricultural Economics Reports 33983, United States Department of Agriculture, Economic Research Service. [Downloadable!]
  20. Palsson, Anne-Marie, 1996. "Does the degree of relative risk aversion vary with household characteristics?," Journal of Economic Psychology, Elsevier, vol. 17(6), pages 771-787, December. [Downloadable!] (restricted)
Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Lyubov A. Kurkalova & Catherine L. Kling & Jinhua Zhao, 2003. "Multiple Benefits of Carbon-Friendly Agricultural Practices: Empirical Assessment of Conservation Tillage," Center for Agricultural and Rural Development (CARD) Publications 03-wp326, Center for Agricultural and Rural Development (CARD) at Iowa State University. [Downloadable!]
  2. Kurkalova, Lyubov & Kling, Catherine L. & Zhao, Jinhua, 2003. "Multiple Benefits of Carbon-Friendly Agricultural Practices: Empirical Assessment of Conservation Tillage in Iowa," Staff General Research Papers 10194, Iowa State University, Department of Economics.
  3. JunJie Wu & Richard M. Adams & Catherine L. Kling & Katsuya Tanaka, 2003. "Assessing the Costs and Environmental Consequences of Agricultural Land Use Changes: A Site-Specific, Policy-Scale Modeling Approach," Center for Agricultural and Rural Development (CARD) Publications 03-wp330, Center for Agricultural and Rural Development (CARD) at Iowa State University. [Downloadable!]
    Other versions:
Statistics
Access and download statistics

Did you know? You can use convenient plug-ins to search directly IDEAS from your browser.

This page was last updated on 2009-12-7.

This information is provided to you by IDEAS at the Department of Economics, College of Liberal Arts and Sciences, University of Connecticut using RePEc data on a server sponsored by the Society for Economic Dynamics.