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Small Farms, Externalities, and the Dust Bowl of the 1930s

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  • Zeynep K. Hansen
  • Gary D. Libecap

Abstract

We provide a new and more complete analysis of the origins of the Dust Bowl of the 1930s, one of the most severe environmental crises in North America in the 20th Century. Severe drought and wind erosion hit the Great Plains in 1930 and lasted through 1940. There were similar droughts in the 1950s and 1970s, but no comparable level of wind erosion. We explain why. The prevalence of small farms in the 1930s limited private solutions for controlling the downwind externalities associated with wind erosion. Drifting sand from unprotected fields damaged neighboring farms. Small farmers cultivated more of their land and were less likely to invest in erosion control than were larger farmers. Soil Conservation Districts, established by government after 1937, helped coordinate erosion control. This unitized' solution for collective action is similar to that used in other natural resource/environmental settings.
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Suggested Citation

  • Zeynep K. Hansen & Gary D. Libecap, 2004. "Small Farms, Externalities, and the Dust Bowl of the 1930s," Journal of Political Economy, University of Chicago Press, vol. 112(3), pages 665-694, June.
    • Handle: RePEc:ucp:jpolec:v:112:y:2004:i:3:p:665-694
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    File URL: http://dx.doi.org/10.1086/383102
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    File URL: http://dx.doi.org/10.1086/383102
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    Cited by:

    1. Leah Platt Boustan & Price V. Fishback & Shawn Kantor, 2010. "The Effect of Internal Migration on Local Labor Markets:American Cities during the Great Depression," Journal of Labor Economics, University of Chicago Press, vol. 28(4), pages 719-746, October.
    2. Price V. Fishback & John Joseph Wallis, 2012. "What Was New About the New Deal?," NBER Working Papers 18271, National Bureau of Economic Research, Inc.
    3. Price Fishback, 2017. "How Successful Was the New Deal? The Microeconomic Impact of New Deal Spending and Lending Policies in the 1930s," Journal of Economic Literature, American Economic Association, vol. 55(4), pages 1435-1485, December.
    4. Lee J. Alston & Edwyna Harris & Bernardo Mueller, 2009. "De Facto and De Jure Property Rights: Land Settlement and Land Conflict on the Australian, Brazilian and U.S. Frontiers," CEPR Discussion Papers 607, Centre for Economic Policy Research, Research School of Economics, Australian National University.
    5. Eric C. Edwards, 2016. "What Lies Beneath? Aquifer Heterogeneity and the Economics of Groundwater Management," Journal of the Association of Environmental and Resource Economists, University of Chicago Press, vol. 3(2), pages 453-491.
    6. Kantor, Shawn & Fishback, Price V. & Wallis, John Joseph, 2013. "Did the New Deal solidify the 1932 Democratic realignment?," Explorations in Economic History, Elsevier, vol. 50(4), pages 620-633.
    7. Gary D. Libecap, 2010. "Institutional Path Dependence in Climate Adaptation: Coman's "Some Unsettled Problems of Irrigation"," NBER Working Papers 16324, National Bureau of Economic Research, Inc.
    8. Fleck, Robert K., 2013. "Why did the electorate swing between parties during the Great Depression?," Explorations in Economic History, Elsevier, vol. 50(4), pages 599-619.
    9. repec:nbr:nberch:13950 is not listed on IDEAS
    10. Rodney Ramcharan, 2010. "Inequality and Redistribution: Evidence from U.S. Counties and States, 1890-1930," The Review of Economics and Statistics, MIT Press, vol. 92(4), pages 729-744, November.
    11. Grimm, Michael, 2016. "Rainfall Risk and Fertility: Evidence from Farm Settlements during the American Demographic Transition," IZA Discussion Papers 10351, Institute for the Study of Labor (IZA).
    12. Richard Hornbeck, 2012. "The Enduring Impact of the American Dust Bowl: Short- and Long-Run Adjustments to Environmental Catastrophe," American Economic Review, American Economic Association, vol. 102(4), pages 1477-1507, June.
    13. Price V. Fishback & Werner Troesken & Trevor Kollmann & Michael Haines & Paul W. Rhode & Melissa Thomasson, 2011. "Information and the Impact of Climate and Weather on Mortality Rates During the Great Depression," NBER Chapters,in: The Economics of Climate Change: Adaptations Past and Present, pages 131-167 National Bureau of Economic Research, Inc.
    14. Costello, Christopher & Polasky, Stephen, 2008. "Optimal harvesting of stochastic spatial resources," Journal of Environmental Economics and Management, Elsevier, vol. 56(1), pages 1-18, July.
    15. Gary D. Libecap, 2010. "Institutional Path Dependence in Climate Adaptation: Coman’s “Some Unsettled Problems of Irrigation”," ICER Working Papers 33-2010, ICER - International Centre for Economic Research.
    16. Scott A. Carson, 2016. "Frederick Jackson Turner and the Westward Expanse: Changing Net Nutrition with Economic Development," CESifo Working Paper Series 5869, CESifo Group Munich.
    17. Liu, Yanxu & Sims, Charles, 2016. "Spatial-dynamic externalities and coordination in invasive species control," Resource and Energy Economics, Elsevier, vol. 44(C), pages 23-38.
    18. Fishback, Price V. & Horrace, William C. & Kantor, Shawn, 2006. "The impact of New Deal expenditures on mobility during the Great Depression," Explorations in Economic History, Elsevier, vol. 43(2), pages 179-222, April.
    19. Jason Long & Henry E. Siu, 2016. "Refugees From Dust and Shrinking Land: Tracking the Dust Bowl Migrants," NBER Working Papers 22108, National Bureau of Economic Research, Inc.
    20. Eli Fenichel & Timothy Richards & David Shanafelt, 2014. "The Control of Invasive Species on Private Property with Neighbor-to-Neighbor Spillovers," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 59(2), pages 231-255, October.
    21. Brooks, Leah & Strange, William C., 2011. "The micro-empirics of collective action: The case of business improvement districts," Journal of Public Economics, Elsevier, vol. 95(11), pages 1358-1372.
    22. John Landon-Lane & Hugh Rockoff & Richard H. Steckel, 2011. "Droughts, Floods and Financial Distress in the United States," NBER Chapters,in: The Economics of Climate Change: Adaptations Past and Present, pages 73-98 National Bureau of Economic Research, Inc.
    23. Richard Sutch, 2010. "The Impact of the 1936 Corn-Belt Drought on American Farmers’ Adoption of Hybrid Corn," Working Papers 201002, University of California at Riverside, Department of Economics, revised Jan 2010.
    24. Scott A. Carson, 2018. "In Support of the Turner Hypothesis for the 19th Century American West: A Biological Response to Recent Criticisms," CESifo Working Paper Series 6969, CESifo Group Munich.

    More about this item

    JEL classification:

    • Q24 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Land
    • N52 - Economic History - - Agriculture, Natural Resources, Environment and Extractive Industries - - - U.S.; Canada: 1913-

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