CREP: Cattle Receiving Enhanced Pastures? Investigating Landowner Response to Federal Incentives

Abstract

Using enrollment data on the Conservation Reserve Enhancement Program’s river buffer subprogram from 1998 to 2010, we observe that counties in the top quintile of cattle production receive almost twice as much in initial incentives. Further, in counties with high levels of cattle ranching, enrollments are more responsive per dollar of initial incentive offered. Program regulations allow cattle ranchers to include in their initial incentives “cost share” funding they can use to improve their ranches, while other participants’ up-front costs benefit them less directly. To improve program cost-effectiveness, policy designers should consider how producer and incentive characteristics interact. (JEL H23, Q15)