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

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 p...

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Bibliographic Details
Published in:Journal of agricultural and applied economics 2004-08, Vol.36 (2), p.415-424
Main Authors: Anderson, John D., Parkhurst, Gregory M.
Format: Article
Language:English
Subjects:
Agricultural production
Agriculture
C15
Commodities
conservation
Cost analysis
countercyclical payment
direct payment
Easements
Enrollments
Environmental quality
Environmental restoration
Environmental stewardship
Farms
Funding
Invited Paper Sessions
Landowners
Net present value
Participation
Q12
Q15
Q18
Wetlands
Wildlife conservation
WRP
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Summary: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.
ISSN:1074-0708
2056-7405
1074-0708
DOI:10.1017/S1074070800026699