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

John D. Anderson () and Gregory M. Parkhurst

Journal of Agricultural & Applied Economics, 2004, vol. 36, issue 2, pages 415-424

Abstract: 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.

Keywords: conservation; counter-cyclical payment; direct payment; net present value; WRP (search for similar items in EconPapers)
JEL-codes: Q12 Q15 Q18 C15 (search for similar items in EconPapers)

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Journal of Agricultural & Applied Economics is edited by Jeffrey M. Gillespie

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