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The Impact of Pasture Insurance on Farmland Values

Published online by Cambridge University Press:  15 September 2016

Jennifer Ifft*
Affiliation:
Dyson School of Applied Economics and Management at Cornell University
Shang Wu
Affiliation:
Department of Economics at University of Delaware
Todd Kuethe
Affiliation:
Department of Agricultural and Consumer Economics at University of Illinois at Urbana-Champaign
*
Correspondence: Jennifer IfftDyson School of Applied Economics and ManagementCornell University137 Reservoir AvenueIthaca, NY 14853Phone 607.255.4769Email[email protected].
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Abstract

This study examines the impact of publicly supported insurance on agricultural land values. The analysis employs confidential, nationally representative panel data on field-level pastureland values and exploits a natural experiment provided by gradual introduction of the Pasture, Rangeland, and Forage Insurance Pilot Program. We use a field-level fixed-effects model that controls for several time-variant factors. We find that insurance availability is associated with an increase of at least 4 percent in pastureland values. This increase is comparable with increases generated by other government programs but is much smaller than total farmland value increases experienced in recent years.

Type
Research Article
Copyright
Copyright © 2014 Northeastern Agricultural and Resource Economics Association 

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