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Ethanol Plant Location Determinants and County Comparative Advantage

Published online by Cambridge University Press:  26 January 2015

D.M. Lambert ,
M. Wilcox ,
A. English  and
L. Stewart
D.M. Lambert
Affiliation:
Department of Agricultural Economics, University of Tennessee, Knoxville, TN
M. Wilcox
Affiliation:
Department of Agricultural Economics, University of Tennessee, Knoxville, TN
A. English
Affiliation:
Department of Agricultural Economics, University of Tennessee, Knoxville, TN
L. Stewart
Affiliation:
Department of Agricultural Economics, University of Tennessee, Knoxville, TN
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Abstract

The location of ethanol plants is determined by infrastructure, product and input markets, fiscal attributes of local communities, and state and federal incentives. This empirical analysis uses probit regression along with spatial clustering methods to analyze investment activity of ethanol plants at the county level for the lower U.S. 48 states from 2000 to 2007. The availability of feedstock dominates the site selection decision. Other factors, such as access to navigable rivers or railroads, product markets, producer credit and excise tax exemptions, and methyl tertiary-butyl ether bans provided some counties with a comparative advantage in attracting ethanol plants.

Keywords

cluster analysiscomparative advantageethanol productionlocation modelR1R3
Type
Articles
Information
Journal of Agricultural and Applied Economics , Volume 40 , Issue 1 , April 2007 , pp. 117 - 135
Copyright
Copyright © Southern Agricultural Economics Association 2008

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