Targeting Conservation Funds Increases Environmental
Benefits
LeRoy
Hansen and Daniel
Hellerstein
USDA conservation program funding has increased
steadily from $0.5 billion in 1985 to $5.1 billion
in 2005. Because of agriculture’s close connection
with the environment, conservation programs can
provide many environmental gains. To best serve
the public’s interest, program funds could
be allocated to address the most pressing environmental
concerns. Targeting is an efficient means of achieving
this goal because it directs funds to conservation
program participants based on the expected environmental
benefits.
Conservation programs can be targeted
in many ways, ranging from simple to highly selective.
Targeting can direct funds to:
- A region, such as the Chesapeake Bay watershed.
This simple “broad brush” approach
is generally not the most efficient way to target
but can be effective when data are limited or
the region is a particularly sensitive environmental
area.
- Acreage with particular features, such as highly
erodible lands. This focus is more selective and
likely more efficient than regional targeting
because it accounts for intra-regional variations
in factors that affect environmental concerns.
- Fields and farms that provide the greatest
environmental benefits. This highly selective
approach accounts for at least some of the field-
and farm-level variations in benefits.
Targeting becomes more efficient
as it accounts for more variations in environmental
concerns. Benefits vary because the same conservation
measure can have different environmental impacts,
even on neighboring fields. For example, the water
quality impacts of a conservation practice will
depend on the field’s proximity to water.
Moreover, the same water quality benefits may be
valued more highly near popular vacation areas than
in less visited areas.
Addressing multiple environmental
concerns also improves targeting efficiency. For
example, the Conservation Reserve Program (CRP)
initially targeted highly erodible lands only. The
CRP now targets based on an Environmental Benefits
Index (EBI), which quantifies multiple environmental
benefits, including wildlife habitat and air and
water quality. By moving from its initial targeting
mechanism to the use of the EBI, the CRP benefits
associated with freshwater recreation, wildlife
viewing, and pheasant hunting increased from an
estimated $460 million to almost $830 million per
year for the same level of spending.
In general, program benefits will
increase as targeting becomes more selective, which
will require more data and a better understanding
of the effects of conservation practices. As additional
geospatial data—including satellite imagery
data—become available and the links between
conservation practices and benefits are more understood,
environmental targeting mechanisms can be further
improved and environmental gains from conservation
programs can increase.
This
finding is drawn from . . . |
| Better
Targeting, Better Outcomes, by LeRoy
Hansen and Daniel Hellerstein, EB-2, USDA,
Economic Research Service, March 2006.
The
Conservation Reserve Program: Economic Implications
for Rural America, by Patrick Sullivan,
Daniel Hellerstein, LeRoy Hansen, Robert Johansson,
Steven Koenig, Ruben Lubowski, William McBride,
David McGranahan, Michael Roberts, Stephen
Vogel, and Shawn Bucholtz, AER-834, USDA,
Economic Research Service, October 2004. |
|
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