Upstream Advantage: The Economic Value of Water Security Under Riparian Rights in Eastern U.S. Agriculture

Nawon Kang and Mani Rouhi Rad

No 360772, 2025 AAEA & WAEA Joint Annual Meeting, July 27-29, 2025, Denver, CO from Agricultural and Applied Economics Association

Abstract: This paper investigates whether counties positioned upstream in river networks—those physically first in line for stream flow under riparian water rights—experience greater resilience in agricultural land values and crop productivity during drought. Using county-level panel data from 1950 to 2022 across the Eastern United States, we combine agricultural outcomes with geospatial measures of stream proximity and groundwater access, and evaluate their interaction with standardized precipitation anomalies. Benchmark specifications show that groundwater access consistently enhances farmland value and yields, while stream access yields more nuanced patterns: downstream access is associated with higher farmland values under normal conditions, whereas upstream access is negatively associated with corn yields on average and shows limited benefits under extreme drought. However, upstream counties exhibit higher farmland values under prolonged dryness and greater corn yield gains during wet years—benefits not observed for soybean yields or in downstream areas. These results suggest that upstream proximity offers conditional advantages tied to crop water sensitivity and climate regime. As drought risk intensifies, this study provides the first systematic empirical evidence on how spatial positioning within stream networks under riparian doctrine shapes the economic geography of agricultural resilience.

Keywords: Environmental; Economics; and; Policy (search for similar items in EconPapers)
Pages: 16
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:ags:aaea25:360772

DOI: 10.22004/ag.econ.360772

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