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Title:Impact of Tenure and Uncertainty on the Choice of Optimal Soil Erosion Control Measures
Author(s):Venkataraman, Ravi Rajagopal
Department / Program:Agricultural Economics
Discipline:Agricultural Economics
Degree Granting Institution:University of Illinois at Urbana-Champaign
Subject(s):Economics, Agricultural
Abstract:Soil conservation issues re-surfaced in the United States during 1970's when crop acreage expanded by more than 120 percent to meet a 132 percent rise in agricultural exports. This large rapid expansion in cropland acres generated concern that increase in soil erosion might impair the nation's long term food producing capability.
The goal of this research was to examine, at the micro level, the interrelationship among planning horizons, type of land tenure, and selection of optimal soil conservation management systems. An investigation was undertaken of the extent to which weather (R-factor), yield, product price, and soil loss uncertainties affected the adoption of these systems in the short run and in the long run. The effect of taxes and subsidies in the selection of optimal soil conservation management systems was also considered.
A stochastic simulation model (SSOILEC) which allowed the simultaneous consideration of uncertainty in revenues due to weather (R-factor), crop yields, and crop prices was selected for this study. The quadratic programming model with a stochastic soil loss constraint was selected to examine the influence of an individual's risk attitudes on the adoption of soil conservation management systems.
The findings of the study clearly showed that the tenancy and uncertainty influence the selection of soil conservation management systems. In general, regarding subsidy payment for terrace construction, we saw that in the 25-year period, both the tenant and the owner-operator were willing to adopt terracing if full subsidy payment for terrace construction cost was given. However, in the 10-year period, the tenant was willing to adopt terracing if full subsidy payment was given, while restricting the soil loss to the T-value. But if there was no soil loss restriction, even with full subsidy payment, he was not willing to adopt terracing. An owner-operator, in the 10-year period, adopted terracing when there was full subsidy payment with or without soil loss restriction, albeit at lower levels compared to the 25-year period. In the short run, the tenant was not willing to adopt terracing in any case. The owner-operator for the same time period adopted terracing if there was a full subsidy payment with soil loss restricted to the T-value. But when there was full subsidy payment without any soil loss restriction, he was better off not adopting terracing in the 1-year period.
The conclusion was that the tenant had limited opportunities since his returns were too low. He was not able to cultivate 300 acres even at very low risk aversion levels. He adopted the no-till system at all risk aversion levels. It was also noted that tenants preferred corn-soybean rotation with no-till; while, for the owner-operator choice of this rotation depended on the risk level. (Abstract shortened with permission of author.)
Issue Date:1988
Description:339 p.
Thesis (Ph.D.)--University of Illinois at Urbana-Champaign, 1988.
Other Identifier(s):(UMI)AAI8908879
Date Available in IDEALS:2014-12-17
Date Deposited:1988

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