Suchergebnisse

AbstractCurrent and proposed policies aim to leverage the Federal Crop Insurance Program (FCIP) to promote conservation practices. This study uses corn farm‐level survey data to inform the effectiveness of targeting FCIP participants. We implement an unsupervised machine learning algorithm to assess what conservation practices are most common among participants. We find that farms that use crop insurance have higher adoption rates for practices that are generally profit‐maximizing. We also calculate nitrogen balance, a yield‐scaled measure of nitrogen fertilizer's potential environmental impact. We find a positive relationship between crop insurance and nitrogen balance closer to the optimum.

AbstractThis study uses a county‐level difference‐in‐difference framework to estimate the share of re‐enrollment into the Conservation Reserve Program (CRP) in response to local ethanol production capacity after the Renewable Fuels Standard (RFS). Relatively more land remained in CRP in ethanol‐intensive areas after the RFS. This seemingly counter‐intuitive result can be explained by post‐RFS changes to the CRP that favored ethanol‐intensive areas. Both CRP design changes and production trends correlated with ethanol plant location pose challenges for empirical strategies that use ethanol plant location to study production or land use decisions. Changes to CRP policies can play an important role in participation and land use decisions.

AbstractCrop insurance protects lenders by increasing the likelihood of loan repayment when revenue declines. We develop a theoretical mode that explains the role of crop insurance in agricultural lending and how impacts may be different for lenders that are not specialized in agricultural lending. We then test whether the total volume of production credit extended by commercial banks at the county level increases in response to crop insurance availability and whether the level of the response is related to bank specialization in agriculture. We use a novel difference‐in‐differences strategy based on some counties having a higher share of agricultural production that was not covered by Federal crop insurance in the 1990s. Crop insurance has a robust relationship with increased loan volumes during this period, especially in counties with fewer banks specialized in agriculture.