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Farmer Premiums for the Voluntary Adoption of Conservation Plans

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  • Joseph Cooper
  • Giovanni Signorello

Abstract

Programs that reimburse farmers for the cost of implementing more environmentally benign management practices are becoming increasingly popular in both the US and the EU. Utilizing the random utility and random profit difference approaches, the paper develops a theoretical model that explains why farmers may require a premium in excess of the decrease in profits to adopt a conservation plan, and may even require a premium in the case where adoption of the plan is associated with a mean increase in profits. This premium is estimated using a survey of farmers in conjunction with predictions of changes in production costs.

Suggested Citation

  • Joseph Cooper & Giovanni Signorello, 2008. "Farmer Premiums for the Voluntary Adoption of Conservation Plans," Journal of Environmental Planning and Management, Taylor & Francis Journals, vol. 51(1), pages 1-14.
  • Handle: RePEc:taf:jenpmg:v:51:y:2008:i:1:p:1-14 DOI: 10.1080/09640560701712234
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    References listed on IDEAS

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    7. Johannesson, Magnus & Johansson, Per-Olov, 1997. "Quality of life and the WTP for an increased life expectancy at an advanced age," Journal of Public Economics, Elsevier, pages 219-228.
    8. Johansson,Per-Olov, 1995. "Evaluating Health Risks," Cambridge Books, Cambridge University Press, number 9780521472852, December.
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    Cited by:

    1. Barreiro-Hurlé, Jesús & Espinosa-Goded, Maria & Dupraz, Pierre, 2008. "Re-considering Agri-Environmental Schemes premiums: the impact of fixed costs in sign-up decisions," 2008 International Congress, August 26-29, 2008, Ghent, Belgium 43606, European Association of Agricultural Economists.
    2. Bateman, Ian J. & Day, Brett H. & Dupont, Diane P. & Georgiou, Stavros, 2006. "Incentive compatibility and procedural invariance testing of the one-and-one-half-bound dichotomous choice elicitation method: distinguishing strategic behaviour from the anchoring heuristic," 2006 Annual meeting, July 23-26, Long Beach, CA 21104, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    3. Wade, Tara & Kurkalova, Lyubov & Secchi, Silvia, 2016. "Modeling Field-Level Conservation Tillage Adoption with Aggregate Choice Data," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 41(2), May.
    4. David Conner & Jennifer Miller & Asim Zia & Qingbin Wang & Heather Darby, 2016. "Conjoint Analysis of Farmers’ Response to Conservation Incentives," Sustainability, MDPI, Open Access Journal, vol. 8(7), pages 1-15, July.
    5. Canales, Elizabeth & Bergtold, Jason S. & Williams, Jeffery & Peterson, Jeffrey, 2015. "Estimating farmers’ risk attitudes and risk premiums for the adoption of conservation practices under different contractual arrangements: A stated choice experiment," 2015 AAEA & WAEA Joint Annual Meeting, July 26-28, San Francisco, California 205640, Agricultural and Applied Economics Association;Western Agricultural Economics Association.
    6. repec:eee:ecolec:v:137:y:2017:i:c:p:70-82 is not listed on IDEAS
    7. Guay, Alain & Lamarche, Jean-François, 2012. "Structural Change Tests Based On Implied Probabilities For Gel Criteria," Econometric Theory, Cambridge University Press, pages 1186-1228.
    8. Maria Espinosa-Goded & Pierre Dupraz & Jesùs Barreiro-Hurlé, 2009. "Fixed costs involved in crop pattern changes and agri-environmental schemes," Working Papers SMART - LERECO 09-15, INRA UMR SMART-LERECO.

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