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The Relationship Between Economically and Environmentally Marginal Land

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  • Deal, John

Abstract

Concerns have frequently been raised regarding the impact of federally-subsidized crop insurance and agricultural subsidy payments on land allocation and crop mix choices. If the reduction in production risk encourages farmers to plant on economically marginal land, it has often been asserted that this will lead to increases in environmental damage, including increases in soil erosion rates. This paper investigates the "conventional" wisdom that economically marginal land is also environmentally fragile, as defined by higher levels of inherent soil erodibility. We address this issue by looking at the distribution of crop yields for 4 major crops across National Resource Inventory (NRI) erodibility classes and by performing regression analysis. Our results indicate that land with higher levels of soil erodibility exhibit lower mean crop yields, a proxy for economic marginality, which lends support to the conventional wisdom.

Suggested Citation

  • Deal, John, 2006. "The Relationship Between Economically and Environmentally Marginal Land," 2006 Annual meeting, July 23-26, Long Beach, CA 21119, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
  • Handle: RePEc:ags:aaea06:21119
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    File URL: http://purl.umn.edu/21119
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    References listed on IDEAS

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    1. Barry K. Goodwin & Monte L. Vandeveer & John L. Deal, 2004. "An Empirical Analysis of Acreage Effects of Participation in the Federal Crop Insurance Program," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 86(4), pages 1058-1077.
    2. Robert K. Kaufmann & Seth E. Snell, 1997. "A Biophysical Model of Corn Yield: Integrating Climatic and Social Determinants," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 79(1), pages 178-190.
    3. Andrew J. Plantinga, 1996. "The Effect of Agricultural Policies on Land Use and Environmental Quality," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 78(4), pages 1082-1091.
    4. Hansen, LeRoy T., 1991. "Farmer Response to Changes in Climate: The Case of Corn Production," Journal of Agricultural Economics Research, United States Department of Agriculture, Economic Research Service, issue 4.
    5. Dixon, Bruce L. & Segerson, Kathleen, 1999. "Impacts Of Increased Climate Variability On The Profitability Of Midwest Agriculture," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 31(03), December.
    6. Dixon, Bruce L. & Hollinger, Steven E. & Garcia, Philip & Tirupattur, Viswanath, 1994. "Estimating Corn Yield Response Models To Predict Impacts Of Climate Change," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 19(01), July.
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    Keywords

    Environmental Economics and Policy;

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