Additionality of afforestation incentives: Evidence from the Conservation Reserve Program

Afforestation, which involves converting cropland to forestland, can provide multiple ecosystem services. Consequently, public incentive programs such as those administered by the U.S. Department of Agriculture (USDA), and, increasingly, private incentive programs, provide funding to farmers to convert their land to forest. However, the degree to which afforestation incentives provide greater ecosystem services depends on the degree to which afforestation is additional, both in the short- and long-term. Incentives are additional if they lead to forest growth that would not have occurred without payments. In this study, we assess the additionality of incentives for afforestation of cropland in USDA's Conservation Reserve Program over a two-decade time span. We estimate impacts using a regression discontinuity design that leverages the Conservation Reserve Program's General Signup auction mechanism. We use remote-sensing data to compare the extent of trees on land that had rejected and accepted offers to enroll in the program. We find that 32 to 65 percent of land enrolled is additional; and that impacts of incentives on tree cover remain steady from nine to twenty years after initial offers are made.