Abstract

Based on 2004 CEAP-ARMS Phase II data, higher-sales farms not participating in a conservation programme adopted farmland conservation structures much more intensively on wheat fields than did any other farm-size type among conservation programme participants or non-participants. Survey results suggest that wheat farms not participating in a conservation programme more frequently adopted infield conservation structures, while conservation programme participants more often installed field perimeter conservation structures. Wheat producers, particularly those not participating in a conservation programme, recognize productivity and profitability benefits of infield structures as sufficient to promote their adoption without programme incentives. However, for field perimeter structures, programme incentives may be needed to encourage their adoption because benefits are more commonly off-site. To supplement univariate comparisons between conservation programme participants and non-participants, we used a cost-function based acreage allocation model to examine adoption of structural conservation practices, including such practices as strip cropping, terraces, grassed waterways, field borders, and stream-side herbaceous buffers. To accurately assess the potential environmental impacts of conservation programmes, it is important to account for the variability in on-site field, farm, and environmental conditions influencing producer adoption decisions. Econometric models suggest that not accounting for factors such as field, farm, operator, and environmental attributes will likely under- or overestimate adoption of conservation structures with respect to input and commodity prices, regardless of programme participation status.

Notes

1.

The views expressed are the authors' and do not necessarily represent those of the Economic Research Service, the US Department of Agriculture, the University of Tennessee, or the University of Delaware.

2.

USDA's National Resources Inventory (NRI) is a longitudinal survey of soil, water, and related environmental resources designed to assess conditions and trends on non-federal US lands. Data is collected for a field (or primary sampling unit (PSU)) associated with specific latitude/longitude points. For more information, see http://www.nrcs.usda.gov/technical/NRI/.

3.

For more information on ARMS, see the website: http://www.ers.usda.gov/Briefing/ARMS, and for CEAP, see the website: http://www.nrcs.usda.gov/technical/nri/ceap/index.html.

4.

CEAP-ARMS states for 2004 wheat included Washington, Oregon, Idaho, Montana, North Dakota, South Dakota, Nebraska, Colorado, Kansas, Oklahoma, Texas, Minnesota, Missouri, Illinois, Michigan, and Ohio.

5.

The ARMS Phase 3 response rates vary by year, but usually average about 60–67% of Phase 2 sample completions. ARMS Phase 3 weights are appropriately re-calibrated by USDA's National Agricultural Statistics Service.

6.

In addition to HELCC, conservation financial assistance programmes included in the definition for ‘participants’ involved the following programmes: Conservation Security (now Stewardship) Program (CSP), Environmental Quality Incentives Program (EQIP), Klamath Basin Water Conservation Program, Ground and Surface Water Conservation Program, Wetlands Reserve Program (WRP), Wildlife Habitat Incentives Program (WHIP), Conservation Reserve Program (CRP), Farmland Preservation Programs, and State Cost-Share Programs.

7.

Phase II data was used to define conservation programme participants versus non-participants because the CEAP-ARMS Phase II conservation programme participation information applies to field-level practices, while the Phase III programme participation information applies to the whole farm, but not necessarily to the Phase II conservation practice data linked to the NRI environmental data.

8.

The aggregate farm typology we used was used by Lambert et al., 2007b. The full ERS farm typology is defined at http://www.ers.usda.gov/Briefing/FarmStructure/glossary.thm#typology.

9.

Gully erosion and the USLE are field-specific land-quality indicators. The USLE is a computed measure of expected soil loss (in tons/acre/year) from the field given its general environmental characteristics, identified at an NRI point for the field. However, gully erosion occurring on a field is a survey-based producer-specified indicator of erosion severity.

10.

The CEAP-ARMS data suggests that there were about 347 000 wheat farms with HEL acres in a wheat field, accounting for about 15.8 million wheat acres, with conservation programme participants accounting for 61% of these acres.

11.

Full utilization for the traditional probabilistic framework is a necessity because technology allocation shares must sum to 100% of the assumed fixed landholdings (Just & Zilberman, 1983).

12.

For information on empirical model structure, its design matrix and parameter estimation, contact the authors at schaible@ers.usda.gov, dlamber1@utk.edu, or ckim@ers.usda.gov.

13.

For HEL land, conservation compliance is mandatory, that is, all HEL land is required to have a conservation plan. While there may be some differences in adoption behaviour between mandatory and voluntary participants, the CEAP-ARMS data does not differentiate these differences. Therefore, we restrict our modeling to address only participant versus non-participant behaviour.

14.

Use of GEE to estimate separate acreage-supply equations by technology does account for differences between adopters and non-adopters, which is a special case of sample selection problems. However, self-selection problems for a second-level joint probability distribution are not modeled here (due to a lack of commercially available software packages capable of addressing these issues for such a complex two-level system). Nonetheless, even in the presence of sample selection bias or other issues leading to endogeniety problems, general associations between variables and responses can still be appreciated (Cameron & Trivedi, 2005). Problems arise when the research aims to go beyond associations and establish causality. Lichtenberg (JARE 2004) and Cooper and Keim (AJAE 1996) also acknowledged this issue and recognized an appropriate need to make similar trade-offs.

15.

First, the structural technology class variables are a requirement of the estimable functional form (see equation 9) that isolate technology-specific effects for the pth programme participation class. Second, because for some fields, practices (like terraces) may have been installed with incentive payments when the land was owned by a previous landowner, we at least in part, control for this possibility by adding variables to account for the time of installation of the structural practice on the field.

16.

Per-unit prices for nitrogen, agricultural wages, diesel fuel, and output (for wheat) reflect state-average prices for 2004 acquired from USDA's National Agricultural Statistics Service (as summarized by USDA's Economic Research Service, 2006).

17.

While not available in CEAP-ARMS, unit costs for selected conservation practices funded by USDA's EQIP are summarized in an ERS data product (at http://www.ers.usda.gov/Data/eqip/). These costs can range from $1.06 per foot for terraces to $3764.82 per structure for a grade stabilization structure.

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