What Drives Landowners’ Conservation Decisions? Evidence from Iowa
Wendiam Sawadgo, Wendong Zhang, Alejandro Plastina
September 2020 [20-WP 610]
Conservation practices such as no-till and cover crops have been shown to have on- and off-farm benefits. However, when benefits of a practice do not go to the provider, underinvestment may occur. Farmland rental arrangements where tenants may not reap the benefits of conservation investments are a commonly cited barrier to conservation practice adoption in agriculture and may result in lower adoption rates on rented land than on owner-operated fields. This issue is especially important since more than half of Midwestern farmland is rented out. This article examines the factors driving adoption of four key conservation practices—no-till, cover crops, buffer strips, and ponds/sediment basins—using a statistically representative survey of Iowa landowners. We find evidence supporting the hypothesis that adoption is lower on rented land for cover crops, buffer strips, and sediment basins, but not for no-till. Our results also show that the large proportion of the state’s land owned by non-operating landowners and absentee land-owners could present a barrier to increasing adoption of conservation practices. Furthermore, landowners seem open to increasing the use of cover crops in the immediate future and a sizable number are even willing to incentivize tenants by paying for part of the cover crop planting cost. Finally, almost half of landowners would be willing to increase the area of their land under conservation practices if they could receive conservation-related tax credits or deductions, suggesting a potential policy strategy to increase adoption.
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