Hostname: page-component-6766d58669-tq7bh Total loading time: 0 Render date: 2026-05-21T21:36:04.909Z Has data issue: false hasContentIssue false
  • English
  • Français

Economic Comparison of Commodity and Conservation Program Benefits: An Example from the Mississippi Delta

Published online by Cambridge University Press:  28 April 2015

John D. Anderson  and
Gregory M. Parkhurst
John D. Anderson
Affiliation:
Department of Agricultural Economics, Mississippi State University, Starkville, MS
Gregory M. Parkhurst
Affiliation:
Department of Agricultural Economics, Mississippi State University, Starkville, MS
Get access Rights & Permissions [Opens in a new window]

Abstract

Changes to commodity programs in the 2002 Farm Bill increased the value of crop base acreages on which decoupled payments are received. The bill also expanded the availability of key conservation programs. This paper compares the value of payments from commodity programs (along with continued crop production) to the easement payment (and recreational lease revenue) available under the Wetland Reserve Program. A net present value model using risk-adjusted returns is employed in the analysis for Mississippi delta cropland containing rice, cotton, and soybean base. Sensitivity analysis is conducted on some of the key variables affecting the decision.

Keywords

conservationcountercyclical paymentdirect paymentnet present valueWRPQ12Q15Q18C15

Information

Type
Invited Paper Sessions
Information
Journal of Agricultural and Applied Economics , Volume 36 , Issue 2 , August 2004 , pp. 415 - 424
Copyright
Copyright © Southern Agricultural Economics Association 2004

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

Article purchase

Temporarily unavailable

References

Atwood, J., Knight, L., Cattaneo, A., and Smith, P.. “Benefit Cost Analysis of the 2002 EQIP Farm Bill Provisions.” Selected Paper presented at the 2003 Annual Meeting of the American Agricultural Economics Association, Montreal, July 27-30, 2003.Google Scholar
Babcock, B.A., Choi, E.K., and Feinerman, E.. “Risk and Probability Premiums for CARA Utility Functions.” Journal of Agricultural and Resource Economics 18(1993):17–24.Google Scholar
Babcock, B.A., Lakshminarayan, P.G., Wu, J., and Zilberman, D.. “Targeting Tools for the Purchase of Environmental Amenities.” Land Economics 73(1997):325–29.CrossRefGoogle Scholar
Feather, P., Hellerstein, D., and Hansen, L.. “Economic Valuation of Environmental Benefits and the Targeting of Conservation Programs: The Case of the CRP.” Agricultural Economics Report No. 778. Washington, DC: U.S. Department of Agriculture, Economic Research Service, 1999.Google Scholar
Garner, A. Assistant state conservationist. Personal communication. Mississippi Natural Resource Conservation Service, 2004.Google Scholar
Heimlich, R.E. “Costs of an Agricultural Wetland Reserve.” Land Economics 70(1994):234–46.CrossRefGoogle Scholar
Heimlich, R.E., Carey, M.B., and Brazee, R.J.. “Beyond Swampbuster: A Permanent Wetland Reserve.” Journal of Soil and Water Conservation 44(1989):445–50.Google Scholar
Khanna, M., Yang, W., Farnsworth, R., and Onal, H.. “Evaluating the Cost Effectiveness of Land Retirement Programs.” Selected Paper presented at the 2002 Annual Meeting of the American Agricultural Economics Association, Long Beach, CA, July 28-31, 2003.Google Scholar
Lichtenberg, E., and Smith, R.-Ramirez. “Cost Sharing, Transaction Costs, and Conservation.” Selected Paper presented at the 2003 Annual Meeting of the American Agricultural Economics Association, Montreal, July 27-30, 2003.Google Scholar
Nickerson, C.J., and Lynch, L.. “The Effect of Farmland Preservation Programs on Farmland Prices.” American Journal of Agricultural Economics 83(2001):341–51.CrossRefGoogle Scholar
Poe, G.L. “Property Tax Distortions and Participation in Federal Easement Programs: An Exploratory Analysis of the Wetlands Reserve Program.” Agricultural and Resource Economics Review 27(1998):117–24.CrossRefGoogle Scholar
Ray, G.WRP coordinator Mississippi. Personal communication. Mississippi Natural Resource Conservation Service, 2003.Google Scholar
Ribaudo, M.O., Osborn, C.T, and Konyar, K.. “Land Retirement as a Tool for Reducing Agricultural Non-Point Source Pollution.” Land Economics 70(1994):77–87.CrossRefGoogle Scholar
Ribaudo, M.O., Piper, S., Schaible, G.D., Langer, L.L., and Colacicco, D.. “CRP: What Economic Benefits?” Journal of Soil and Water Conservation 44(1989):421–24.Google Scholar
Robison, L.J., and Barry, P.J.. Present Value Models and Investment Analysis. Northport, AL: The Academic Page, 1996.Google Scholar
U.S. Department of Agriculture—Natural Resource Conservation Service (USDA-NRCS). Conservation Programs Manual Wetlands Reserve Program. Internet site: http://policy.nrcs.usda.gov/scripts/lpsiis.dll/M/m_440_514_b.htm (Accessed February 10, 2004a).Google Scholar
U.S. Department of Agriculture—Natural Resource Conservation Service (USDA-NRCS). Farm Bill 2002, Wetlands Reserve Program: Key Points. Internet site: http://www. nrcs.usda.gov/programs/farmbill/2002/pdf/WRPKyPts.pdf (Accessed February 10, 2004b).Google Scholar
U.S. Department of Agriculture—Natural Resource Conservation Service (USDA-NRCS). Farm Bill 2002, Wetlands Reserve Program: Program Description. Internet site: http://www.nrcs.usda.gov/programs/farmbill/2002/pdf/WRPPrDes.pdf (Accessed February 10, 2004c).Google Scholar
Young, C.E., and Osborn, C.T.. “The Conservation Reserve Program: An Economic Assessment.” Agricultural Economics Report No. 626. Washington, DC: U.S. Department of Agriculture, Economic Research Service, 1990.Google Scholar