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Temporal Spillovers in Land Conservation

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Temporal spillovers occur when a conservation program changes the use made of a land parcel outside of the window of the conservation contract. This may happen when conservation improves land so that returns to non-conservation uses are increased, or when landowners’ preferences become more pro-conservation as they see land flourish under conservation, for example. These post-contract changes may occur on the extensive margin (acres of land conserved) or intensive margin (intensity of land in a given use). If temporal spillovers exist, benefits from conservation programs estimated by focusing solely on the effects that occur during the conservation contract will overstate or understate the true benefits of the program. I lay out a simple model of temporal spillovers. I test this model in the context of the United States Conservation Reserve Program (CRP). I use a pre-analysis sample specification step to choose counterfactual land most like the CRP land. On the extensive margin, I find that CRP causes some land to be 22-27% more likely to be farmed, potentially offsetting some environmental benefits. However, farmed ex-CRP land is slightly more likely to use a conservation practice. This is a mitigating factor on the intensive margin.

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File URL: http://web.williams.edu/Economics/wp/Jacobson_temporal_spillovers_feb2014.pdf
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Bibliographic Info

Paper provided by Department of Economics, Williams College in its series Department of Economics Working Papers with number 2013-17.

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Length: 51 pages
Date of creation: Apr 2010
Date of revision: Feb 2014
Handle: RePEc:wil:wileco:2013-17

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Keywords: Conservation Reserve Program; land use; environmental policy; farm policy;

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  1. Michael J. Roberts & Ruben N. Lubowski, 2007. "Enduring Impacts of Land Retirement Policies: Evidence from the Conservation Reserve Program," Land Economics, University of Wisconsin Press, vol. 83(4), pages 516-538.
  2. Feather, Peter & Hellerstein, Daniel & Hansen, LeRoy T., 1999. "Economic Valuation of Environmental Benefits and the Targeting of Conservation Programs: The Case of the CRP," Agricultural Economics Reports 34027, United States Department of Agriculture, Economic Research Service.
  3. Walter N. Thurman & Dominic P. Parker, 2011. "Crowding Out Open Space: The Effects of Federal Land Programs on Private Land Trust Conservation," Land Economics, University of Wisconsin Press, vol. 87(2), pages 202-222.
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  7. Severin Borenstein, 2013. "A Microeconomic Framework for Evaluating Energy Efficiency Rebound And Some Implications," NBER Working Papers 19044, National Bureau of Economic Research, Inc.
  8. Robbin Shoemaker, 1989. "Agricultural Land Values and Rents under the Conservation Reserve Program," Land Economics, University of Wisconsin Press, vol. 65(2), pages 131-137.
  9. Jennifer M. Alix-Garcia & Elizabeth N. Shapiro & Katharine R. E. Sims, 2012. "Forest Conservation and Slippage: Evidence from Mexico’s National Payments for Ecosystem Services Program," Land Economics, University of Wisconsin Press, vol. 88(4), pages 613-638.
  10. Cooper, Joseph C. & Osborn, Tim, 1998. "The effect of rental rates on the extension of Conservation Reserve Program contracts," MPRA Paper 24781, University Library of Munich, Germany.
  11. Fischer, Carolyn & Fox, Alan K., 2012. "Comparing policies to combat emissions leakage: Border carbon adjustments versus rebates," Journal of Environmental Economics and Management, Elsevier, vol. 64(2), pages 199-216.
  12. Johnson, Phillip N. & Misra, Sukant K. & Ervin, R. Terry, 1997. "A Qualitative Choice Analysis Of Factors Influencing Post-Crp Land Use Decisions," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 29(01), July.
  13. Hayley H. Chouinard & Tobias Paterson & Philip R. Wandschneider & Adrienne M. Ohler, 2008. "Will Farmers Trade Profits for Stewardship? Heterogeneous Motivations for Farm Practice Selection," Land Economics, University of Wisconsin Press, vol. 84(1), pages 66-82.
  14. JunJie Wu, 2000. "Slippage Effects of the Conservation Reserve Program," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 82(4), pages 979-992.
  15. Robert J. Sheeder & Gary D. Lynne, 2011. "Empathy-Conditioned Conservation: “Walking in the Shoes of Others” as a Conservation Farmer," Land Economics, University of Wisconsin Press, vol. 87(3), pages 433-452.
  16. Suzi C. Kerr, 2013. "The Economics of International Policy Agreements to Reduce Emissions from Deforestation and Degradation," Review of Environmental Economics and Policy, Association of Environmental and Resource Economists, vol. 7(1), pages 47-66, January.
  17. Stavins, Robert N & Jaffe, Adam B, 1990. "Unintended Impacts of Public Investments on Private Decisions: The Depletion of Forested Wetlands," American Economic Review, American Economic Association, vol. 80(3), pages 337-52, June.
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