Cover Practice Definitions and Incentives in the Conservation Reserve Program

Bryan Pratt and Steven Wallander

No 323862, USDA Miscellaneous from United States Department of Agriculture

Abstract: The environmental benefits of the USDA Conservation Reserve Program (CRP) depend on both the environmental sensitivity of land enrolled and the conservation covers selected for that land. The CRP’s General Signup, which enrolls the majority of program acreage, uses a combination of competitive pressure and cost sharing to encourage higher quality conservation covers. In this report, we examine recent data obtained for General Signups 45, 49, and 54 (implemented in 2013, 2016, and 2020, respectively) to understand offer value and cost-share payments for cover choices. The findings in the report include identifying the most common practice choices, reporting on the average practice cost paid by the participants and USDA, how the participant's choice of cover practice responds to these costs and the incentive points associated with practices. We use our empirical results and a simple conceptual model to describe the implications of policy changes that would adjust the ranking or financial incentives to select higher quality conservation covers. The report presents evidence to suggest that the costs of cover practices—and related policy levers—impact producers decisions and, by extension, program outcomes.

Keywords: Agribusiness; Agricultural Finance; Crop Production/Industries; Environmental Economics and Policy; Farm Management; Land Economics/Use; Resource/Energy Economics and Policy (search for similar items in EconPapers)
Pages: 47
Date: 2022-02-23
New Economics Papers: this item is included in nep-agr and nep-env
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:usdami:323862

DOI: 10.22004/ag.econ.323862

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