Goal 1: Enhance International Competitiveness
of American Agriculture.
Key Outcome
ERS research and analytical activities are designed to
provide policymakers and other decision makers with an
enhanced understanding of economic issues affecting the
U.S. food and agriculture sector’s international
competitiveness, including factors related to market and
nonmarket trade barriers.
Key Accomplishments
India’s Emerging Global Presence. ERS research
reports show how commodity trade patterns are changing
with India’s rising income and that decreasing protectionism
can further trade and improve welfare. For example, the
report, Prospects for India’s Emerging Apple Market,
indicates that investment and open market competition
that reduce high internal marketing costs and margins
offer scope for significant gains in Indian apple consumption
and imports.
China in 21st Century Agricultural Markets. ERS
continues to maintain an active research program that
investigates how policy and economic developments in China
affect global agricultural markets. Recent research points
to the fact that China has substantially raised its profile
in the global market for fruits and vegetables, particularly
in concentrated apple juice, fresh apples, and fresh vegetables.
In other ERS research, China’s rural financial system
is shown to be plagued by non-performing loans and misallocation
of capital to politically-favored projects. If China fails
to reform its financial system, economic growth could
slow.
WTO Negotiations. ERS research on trade policy
is primarily focused on providing analytical support to
help inform and strengthen U.S. negotiating positions
on agriculture. The analysis has focused on the implications
of U.S., European, and other proposals for reforming global
trade. ERS has been developing quantitative estimates
of the impacts of market access and export subsidy liberalization
under each of the three main proposals, and developing
impacts on U.S. trade and farm income. In recent work,
ERS research examined the impacts of dairy policy reform
on global dairy markets. Among other findings, the report
suggests that international dairy policy reform would
result in lower global supplies of milk and dairy products,
higher world dairy prices and higher value of dairy trade.
Goal 2: Enhance the Competitiveness and Sustainability
of Rural and Farm Economies.
Key Outcome
ERS research and analytical activities are designed to
enhance understanding by policymakers and other decision
makers of economic issues affecting the U.S. food and
agriculture sector’s competitiveness, including
factors related to performance, structure, risk and uncertainty,
and marketing.
Key Accomplishments
Assessment of Commodity Programs and Whole Farm Safety
Nets. ERS assesses the effects of farm policy on the food
and agricultural sector. A series of commodity background
reports provide a concise overview of important sectors
of the agricultural economy. They contain information
on production areas, new uses, export markets, policy
changes, farm households, and other information that provides
insights into issues and opportunities confronting each
commodity. ERS also examined proposals for whole-farm
revenue safety net programs, which would be based on revenues
from all farming activities and thus would not be linked
to the production of particular commodities.
Food Consumption and Commodity Markets. Over the
last few years, ERS researchers have examined U.S. consumer
behavior using data from food use survey data. Trends
suggested by the survey data are combined with forecasts
for demographic characteristics to provide views of the
future for associated commodity markets. For example,
everything else remaining constant, demographic data in
the Continuing Survey of Food Intakes of Individuals (CSFII)
suggests future declines in per capita pork consumption
as the share of Hispanics and the elderly in the population
rises because those two groups eat less pork than the
national average. However, total U.S. pork consumption
will grow because of an expansion of the U.S. population.
Consumer Food Spending. ERS estimates the farm
share of consumer food spending. Firms processing and
distributing agricultural commodities contribute to the
task of feeding American consumers by adding value to
what is grown by farmers. In recent decades, however,
gross revenues to these firms have tended to grow more
quickly than farm receipts. Firms beyond the farm gate
have been capturing more of the consumer’s food
dollar, while the farm share of consumer food spending
has decreased. This research confirms this general trend,
but also finds that the farm share of retail food prices
has decreased less than previously believed for two commodity
groupings – fresh fruit and fresh vegetables.
Where You Shop Matters: Store Formats Drive Variations
in Retail Food Prices. American’s food shopping
habits are changing. Just 20 years ago, traditional grocery
stores claimed nearly 90 percent of America’s at-home
food purchases, compared with 69 percent today. Supercenters,
warehouse club stores and other nontraditional food stores
increased their share of consumer food expenditures from
18 percent in 1998 to 31 percent in 2003. ERS investigated
variations in food prices by calculating national prices
for a variety of dairy products, using a unique data set.
Measuring variation in food prices improves our understanding
of inter-regional differences in food purchasing power
and the economic well being households.
Food Market Surveillance. During high-profile
events, such as food safety outbreaks, access to up-to-the-minute
data and information is particularly critical for decision-makers.
To fill this gap, ERS established a quarterly monitoring
system to provide timely and critical information on the
most recent market gainers and losers to identify major
food products with large swings in sales volume, price,
or quantities. With the potential impacts of Avian Influenza
(AI) currently a major concern, ERS contracted with three
private data companies to purchase data and analysis of
both U.S. and international poultry purchase behavior.
This data provides a baseline estimate of the U.S. household
poultry purchases as well as the trends in European and
Asian countries that have experienced an AI outbreak.
This enables ERS to compare and contrast actual poultry
purchases of consumers before and after important events
and provide analysis to help decision-makers in the public
and private sector better respond to such events.
Market Analysis and Outlook. ERS continues to
work closely with the World Agricultural Outlook Board
(WAOB) and other USDA agencies to provide short- and long-term
projections of U.S. and world agricultural production,
consumption, and trade. For the fiscal year 2007 President’s
budget, USDA used stochastic budgeting based on an ERS
project. USDA incorporated stochastic price and production
information into its 10-year budget baseline projections.
The Commodity Credit Corporation outlay projections for
countercyclical payments, marketing loan benefits, and
milk income loss contract payments were based on stochastic
information generated by ERS’s Food and Agricultural
Policy Simulation (FAPSIM) model on feed grains (corn,
barley, sorghum, oats), wheat, rice, upland cotton, soybeans,
and dairy.
Web-based Results of Agricultural Resource Management
Survey (ARMS). Farm finance and structure data
available through the ARMS site include farm business
income statements, farm business balance sheets, farm
financial ratios derived from the income and balance sheet
statements, farm business debt repayment capacity measures,
and structural characteristics of farms. ERS makes available
other data including estimates of average net cash income
for farms in three different groups: farms by economic
size, by resource region and by commodity specialization.
In addition, prior year data forecasts of current year
income are provided. Both the Farm Income and Costs and
the ARMS briefing rooms are actively used by persons with
an interest in farm financial status and performance.
Estimates and forecasts of farm business income are used
in briefings for senior management officials of the USDA
and are reported for public use. Estimates and forecasts
of financial position and debt repayment capacity provide
a guide to farms and geographic areas that might be experiencing
financial distress.
Structure and Finance of U/S. Farms: 2005 Family Farm
Report. Published in 2006, this report provides research
examining the status of family farms. Most farms in the
United States—98 percent in 2003—are family
farms. They are organized as proprietorships, partnerships,
or family corporations. Even the largest farms tend to
be family farms. Very large family farms account for a
small share of farms but a large—and growing—share
of farm sales. Small family farms account for most farms
but produce a modest share of farm output. Median income
for farm households is 10 percent greater than the median
for all U.S. households. Small-farm households also receive
substantial off-farm income.
Agricultural Contracting: Trading Autonomy for Risk
Reduction. Farm production is shifting from smaller
to larger family farms and from spot (or cash) markets
to contracts. Expanded use of contracts supports the shift
to larger farms by reducing financial risks for farm operators,
but at a loss of managerial control and reduced autonomy.
In the case of hogs, the risk reduction provided by contracts
is valuable to risk-averse farmers, who seek to avoid
widely fluctuating input and output prices. But hog farmers
also appear to value autonomy highly. Our research shows
that a moderately risk-averse producer would need to be
paid a price premium of nearly 12 percent to give up the
autonomy of independent production.
Approaches to Management and Farm Business Success.
Farm level data has been collected for use in assessing
the relationship between approaches to management and
farm financial success. This work examined the management
structure of farms to ascertain who holds rights of control
over the use of farm assets. Management units that make
decisions for farms were described, extending information
about how farms control and guide their businesses. Results
suggest that the size and nature of the management team
along with the complexity of the farm system have important
implications for the success of the operation.
The First Decade of Genetically Engineered Crop in
the United States. Ten years after the first generation
of genetically engineered (GE) varieties became commercially
available, ERS reviewed the adoption of GE crops in the
United States. It examines the three major stakeholders
of agricultural biotechnology and finds that (1) the pace
of R&D activity by producers of GE seed (the seed
firms and technology providers) has been rapid, (2) farmers
have adopted some GE varieties widely and at a rapid rate
and benefited from such adoption, and (3) the level of
consumer concerns about foods that contain GE ingredients
varies by country, with European consumers being most
concerned.
Government Patenting and Technology Transfer.
ERS recently examined the use of intellectual property
rights in Federal technology transfer, focusing primarily
on the Agricultural Research Service (ARS). ARS uses patenting
and licensing when a technology requires additional development
by a private sector partner to yield a marketable product.
Licensing revenue is not a major motivation. Greater use
of patenting and licensing by ARS has not reduced the
use of traditional instruments of technology transfer
such as scientific publication. The structure of licensing
agreements affects technology transfer outcomes. Mutually
advantageous revisions to license terms may at times maintain
the incentives through which private companies distribute
the benefits of public research.
Efforts to Conserve Crop Genetic Resources may not
be Sufficient. Economic assessment by ERS suggests
that current efforts to conserve crop genetic resources
may not be sufficient. Crop genetic resources are largely
public goods, so private incentives for genetic resource
conservation may fall short of achieving public objectives.
Within the U.S. germplasm system, certain crop collections
lack sufficient diversity to reduce vulnerability to pests
and diseases. Because many sources of genetic resources
lie outside the U.S, ERS examined three proposed mechanisms
to conserve plant genetic resources: financial assistance
for conservation, stronger intellectual property rights,
and technology transfer and capacity building. Analysis
suggests that, as currently constituted, these initiatives
appear either too limited in scope, too weakly linked
to conservation efforts or inadequately funded to achieve
stated objectives of crop genetic resources conservation
abroad.
R&D and Uncertain Impacts of Future Productivity
Gains. ERS recently published an analysis regarding
future productivity gains from agricultural research and
development. This report, The Seed Industry in U.S. Agriculture,
emphasizes the impressive gains in agricultural productivity
that have been driven by both public and private research,
but notes uncertainty about how the increased research
investment by the private sector, industry consolidation,
and changes in public funding of research will affect
R&D and its productivity impacts in the future.
Goal 3: Support Increased Economic Opportunities and
Improved Quality of Life in Rural America.
Key Outcome
ERS research and analytical activities are designed to
enhance understanding by policymakers, regulators, program
managers, and organizations that shape public debate of
economic issues affecting rural development, including
factors related to farm finances and investments in rural
people, businesses and communities, and of economic issues
related to the performance of all sizes of American farms.
Key Accomplishments
Economic Well-being of Farm Households. Farm subsidy
programs were introduced in the 1930s largely due to concern
for chronically low, and highly variable, incomes of U.S.
farm households. Today, commodity-based support programs
are still prominent, though income and wealth of the average
farm household now exceeds that of the average nonfarm
household - by a large margin. Farm income continues to
be highly variable, but the small set of farm households
most at risk for income variability - because farm income
represents more than one-third of household income - are
those operating large farms. These farms have substantial
net worth, which cushions uncertain farm income.
Growing Farm Size and the Distribution of Farm Payments.
ERS recently examined the disposition of farm subsidies.
Crop production is shifting to much larger farms. Since
government commodity payments reflect production volumes
for program commodities, payments are also shifting to
larger farms. In turn, the operators of very large farms
have substantially higher household incomes than other
farm households, and as a result government commodity
payments are also shifting to much higher-income households.
Since the changes in farm structure appear to be ongoing,
commodity payments will likely, under current policies,
continue to shift to higher income households. This brief
uses 2003 ARMS data to detail the shifts.
Education as a Rural Development Strategy. Educational
attainment in rural America reached a historic high in
2000, with nearly one in six rural adults holding a 4-year
college degree, and more than three in four completing
high school. As the demand for workers with higher educational
qualifications rises, many rural policymakers have come
to view local educational levels as a critical determinant
of job and income growth in their communities.
Future Impact of the Baby Boom Cohort on Rural Migration.
ERS research on nonmetro population change focused on
the future impact of the baby boom cohort on rural migration,
the relationship between Hispanic in-migration and economic
restructuring, and the growing number of African-American
retirees choosing to live in nonmetro areas. Demographic
trends also reflect a relentless geographic expansion
of U.S. metro areas, a steady rise in the number of long-distance
commuters, and rapid population growth in adjacent, nonmetro
counties. In contrast, over 1,000 counties experienced
overall population loss since 2000, most of which are
sparsely populated and isolated from metro regions. With
the natural increase in nonmetro areas now at historically
low levels, migration will dominate future rural demographic
trends. As a result, the fortunes of rural America in
this new century are ever more closely intertwined with
events beyond its boundaries and with the social, economic,
technological and political forces that shape those events.
ERS research will continue to focus on the changing economic
and social conditions of rural residents as they move
through large-scale, demographic transitions.
Goal 4: Enhance Protection and Safety of the Nation’s
Agriculture and Food Supply.
Key Outcome
ERS research and analytical activities are designed to
enhance understanding by policymakers and other decision
makers of economic issues related to improving the efficiency,
efficacy, and equity of public policies and programs aimed
at protecting consumers from unsafe food.
Key Accomplishments
Food Safety, Insurance, and Third-Party Certifiers.
ERS research on traceability in food supply showed that
there are many private sector third-party certifiers world-wide.
ERS and the University of Pennsylvania conducted a workshop
bringing together insurance industry representatives,
third-party certifiers and standards owners, lawyers,
and government food safety experts and certifiers. The
workshop examined the relation between USDA programs and
third-party food safety certification, especially questions
of liability. We learned that certifiers have side-stepped
legal liability but appear to be contributing to stricter
food safety production decisions throughout the supply
chain. The workshop was a first step in assessing the
importance of certification.
Evaluating Programs to Reduce Health Risks Under Limited
Budget. Policymakers are increasingly faced with allocating
scarce funds among critical health risk reduction programs.
Though there are no rules for making these types of decisions,
economic principles can help. The principle of weighing
costs and benefits can help policymakers determine which
programs will save the most lives or lead to the largest
improvements in health and well-being. There are a variety
of ways to tally costs and benefits. In recent work, ERS
food safety researchers examined how accounting for individual
risk preferences can help policymakers allocate scarce
dollars among programs.
Bovine Spongiform Encephalopathy (BSE) in North America.
The first confirmed cases of BSE in Canada and the U.S.
produced significant impacts on trade and prices of U.S.
cattle and beef. However, the first North American BSE
cases occurred during a period of low U.S. beef supplies,
near-record but declining prices, and strong domestic
demand for beef that was largely unshaken by the BSE announcement.
ERS assesses factors affecting the beef markets and related
meat markets. ERS provided a systematic review of market
impacts beginning with the first case of BSE in North
America in 2003. That report finds that increased regulations
imposed additional costs on beef production and processing
sectors. Canadian cattle and beef are now able to enter
the United States, though with some restrictions. U.S.
beef exports to Japan resumed for a short time, have been
halted, and it may take years for U.S. exports there to
return to earlier levels.
Program of Research on the Economics of Invasive Species
Management (PREISM). ERS analysis through PREISM develops
research to improve the economic basis for invasive species
management decisions in cooperation with APHIS and other
USDA agencies. PREISM distributes funds through two mechanisms:
peer-reviewed, competitive extramural research, which
distributed $4.9 million over the last four years (2003-2006),
and intramural research aimed at strengthening internal
analytical capabilities to support four USDA invasive
species program needs. PREISM research has funded 33 cooperative
research or cooperative assistance agreements, and additional
interagency agreements and competitive grants. Research
with application to animal disease issues include: Value
of Animal Traceability Systems in Managing Contagious
Animal Diseases, Economic Impacts of Foreign Animal Disease,
Robust Inspection for Invasive Species with a Limited
Budget; and Economics of Managing Infectious Wildlife
Disease When Livestock are at Risk. PREISM has also funded
research to prioritize invasive species management on
public lands.
ERS has published intramural research that estimated
the economic effects of wind-borne soybean rust in 2004,
highlighting the important factors involved in economic
risk assessment, and the value of information of USDA’s
Coordinated Framework for soybean rust surveillance in
2006. ERS staff also examined the market effects of bovine
spongiform encephalopathy cases in Canada and the United
States in 2006. PREISM-funded researchers estimated the
economic effects of an APHIS rule to allow imports of
Hass avocados from Mexico, and the analysis was included
in the Federal Register notice on Nov. 30, 2004. The extramural
research program has resulted in approximately 40 published
journal articles and book chapters, and over 100 presentations
at professional meetings.
Goal 5: Improve the Nation’s Nutrition and Health.
Key Outcome
ERS research and analytical activities are designed to
enhance understanding by policymakers, regulators, program
managers, and organizations shaping public debate of economic
issues relating to the nutrition and health of the U.S.
population, including factors related to food choices,
consumption patterns at and away from home, food prices,
nutrition assistance programs, nutrition education, and
food industry structure.
Key Accomplishments
How Low-Income Households Allocate Their Food Budget
Relative to the Cost of the Thrifty Food Plan. By
allocating their food budgets in accordance with USDA’s
Thrifty Food Plan (TFP), which serves as a national standard
for a low-cost nutritious diet especially for food at-home,
low-income U.S. households can meet recommended dietary
guidelines. This study seeks to determine whether selected
types of low-income households allocate their food budgets
in accordance with the TFP. In addition to expenditures
for total food and food-at-home, the study looks at four
large food-at-home categories that include meats, cereals
and bakery goods, fruits and vegetables, and dairy products.
The study finds that low-income households as a whole
spend about 86 percent of the TFP costs for food at home.
These households spend approximately the TFP amount on
cereals and bakery goods (102 percent), but only 53 percent
of the TFP costs on fruits and vegetables. Simulations
for specific types of low-income households indicate that
female-headed households with children and married couples
with children are least likely to equal the TFP expenditures.
Household Food Security in the United States.
Food security for a household means that all household
members have access, at all times, to enough food for
an active, healthy life. To inform policymakers and the
public about the extent to which U.S. households consistently
have economic access to enough food, ERS publishes an
annual statistical report on household food security in
the United States. The report and its underlying data
are widely used by government agencies, the media, and
advocacy groups to monitor the extent of food insecurity
in this country, progress toward national objectives,
and performance of USDA’s nutrition assistance programs.
The latest report, Household Food Security in the United
States, 2004, based on data from the December 2004 Food
Security Survey, provided the most recent statistics,
at the time of publishing, on the food security of U.S.
households, as well as on how much they spent for food
and the extent to which food-insecure households participated
in Federal and community nutrition assistance programs.
Results show that 88 percent of American households were
food secure throughout the entire year in 2004. The remaining
12 percent of households were food insecure at least some
time during that year.
Assessing the Nutrient Intakes of Vulnerable Subgroups.
In recent years, concerns about the nutritional adequacy
of the diets of certain population subgroups have arisen.
Recent ERS research provides a comprehensive analysis
of the nutrient adequacy of segments of the population
at risk of inadequate nutrient intake, excessive intake,
or dietary imbalances, based on the CSFII conducted in
1994-96 and 1998. The segments included adolescent females,
older adults, children and adults at risk of overweight,
individuals living in food-insufficient households, low-income
individuals, and individuals targeted by and participating
in nutrition assistance programs. The report adds to a
growing literature that uses current, improved knowledge
of nutrient requirements and recommended nutrient assessment
methods to analyze nutrient intakes. The report indicates
generally inadequate intakes of key micronutrients, especially
magnesium, calcium, folate, and vitamin E; energy intakes
less than recommended energy requirements for adults;
and consumption of too much food energy from fat and not
enough from carbohydrates; and inadequate intakes of fiber.
In addition, diet adequacy deteriorates as individuals
get older. Children—especially infants and young
children—have diets that are more nutritionally
adequate than those of adolescents and adults.
Relationship between Food Stamps Receipt and Obesity
has Weakened. Because food stamps are designed to
serve as a first-line defense against food insecurity,
food stamps are not expected to be connected to America’s
obesity problem. Though such a connection appeared to
exist in the late 1980s and early 1990s, it does not appear
to hold today. ERS research finds a weakening relationship
between food stamp receipt and weight status using the
latest national data. This reversal is most noticeable
among women, the group for which differences between participants
and non-participants received the most attention and for
whom previous research has found the most consistent associations
between food stamps and weight. For women, multi-year
data show the opposite of what we would expect to find
if food stamps were behind increased obesity. For men,
it appears that food stamp participants are catching up
weight-wise with non-participants.
Promoting a Healthful Away-From-Home Diet: Knowledge
and Preferences. Americans consume a growing proportion
of their calories at restaurants and fast food places,
although these foods tend to be more calorie-dense and
nutritionally poorer than foods prepared at home, on average.
However, little is known about how the desire for a healthy
diet and diet-health knowledge affect consumer behavior
in the fast growing away-from-home market. Some have even
questioned whether consumers want healthful foods or apply
their knowledge of health and nutrition, when making choices
about where to eat out and how often to do so. This study
examines the impact of the desires for health, entertainment,
and convenience, along with the consumer’s knowledge
of health and nutrition, on a consumer’s frequency
of eating out and the type of restaurants he or she chooses
to patronize. Having more advanced diet-health knowledge,
as evidenced by a greater understanding of diet-disease
relationships, increases the likelihood that a consumer
patronizes fast-food outlets.
Tracking Trends in U.S. Food Consumption. ERS
maintains the U.S. per capita food consumption data system.
This system is an important statistical indicator that
tracks food and nutrient availability from 1909. The data
facilitate policymaking and regulatory decisions about
farm assistance programs, nutrition education, public
health programs, and regulation of vitamin and mineral
fortification and food labeling. The system is regularly
updated as new data becomes available. The redesigned
interactive Web-based data system released in 2005 allows
users to either download standard spreadsheets or use
the newly expanded custom database to develop tables or
charts for specific food groups, commodities, and years.
In addition, ERS researchers publish reports on U.S. food
consumption patterns using the database on a regular basis.
Consumer Data Initiative. In 2006, ERS continued
development of a comprehensive consumer food consumption
database comprised of the ERS’s Food Consumption
(Per capita) Data System, food intake data gathered from
the National Health and Nutrition Examination Survey (NHANES),
and from proprietary datasets. ERS also finalized the
development of the Flexible Consumer Behavior Survey in
2006, which will be fielded as a supplement to the NHANES
in 2007-2008. ERS acquired three additional food consumption
datasets: the 2003-4 NET (National Eating Trends) and
CREST (Consumer Reports on Eating Share Trends) data from
the NPD Group and the AC Nielsen Homescan consumer panel
data on packaged and random weight food purchases.
Food Stamp Program Costs and Error Rates. Evidence
is strong that, beginning in 1995, an increase in reported
certification-related costs per Food Stamp Program (FSP)
household contributed to reduced error rates. Recent ERS
research studied trends in FSP administrative costs and
errors from 1989 to 2001, describing the trends and composition
of FSP administrative costs. The results imply that, in
the period after the Personal Responsibility and Work
Opportunity Reconciliation Act of 1996, States on average
had to spend more effort on certification-related activities
than in previous years to achieve a given level of accuracy.
Research results predict that, if a State's FSP certification
budget is fixed and the number of FSP households increase,
the effort per FSP household will fall and error rates
will rise, all other things equal.
Recent Trends and Economic Issues in the WIC Infant
Formula Rebate Program. Over half of all infant formula
sold in the United States is purchased through the Special
Supplemental Nutrition Program for Women, Infants, and
Children (WIC). Typically, State WIC agencies obtain substantial
discounts in the form of rebates from infant formula manufacturers
for each can of formula purchased through the program.
However, concern has been raised that the cost to the
States of providing infant formula to WIC participants
is increasing, a result that if sustained, could have
far-reaching negative implications for the WIC Program.
This study found that the cost of providing infant formula
to WIC participants has increased in recent years. This
increase in costs coincides with the introduction of higher
priced DHA- and ARA-supplemented infant formulas. Conditions
may change after the market adjusts to these new formulas.
South Carolina Food Stamp and Well-being Studies.
This study examines patterns of Food Stamp Program use
and other types of in-kind assistance among current and
former welfare recipients in South Carolina and the role
that non-cash assistance plays in maintaining families’
well-being as they transition off of welfare. People who
receive public assistance confront a number of "clocks"
that may affect program participation. Examples of clocks
include time limits on receiving benefits and recurring
deadlines for reconfirming eligibility. This report, South
Carolina Food Stamp and Well-Being Study: Well-Being Outcomes
Among Food Stamp Leavers, examines the role of program
clocks, economic conditions, and other circumstances on
participation in South Carolina's cash and nutrition assistance
programs. The study shows that South Carolina's 2-year
time limit in receiving Temporary Assistance for Needy
Families (TANF) benefits in any 10-year period hastens
exits from and reduces returns to the program and that
the State's policy of quarterly recertifications hastened
exits from the FSP. In addition, annual redeterminations
may contribute to TANF exits. Finding employment speeds
exits from the FSP and cash assistance and delays returns
to the programs. Cash assistance participation may lead
to longer spells of receiving food stamps.
Another report—South Carolina Food Stamp and
Well-Being Study: Transitions in Food Stamp Participation
and Employment Among Adult-Only Households—focused
on adult-only households. Several recent changes in the
FSP have been directed at households without children.
Some of the changes, such as new work requirements and
time limits for able-bodied adults without dependents
(ABAWDs), are intended to encourage economic self-sufficiency
and to reduce program dependence. Other changes are intended
to raise low program participation rates among vulnerable
groups. The study shows that households subject to ABAWD
policies had shorter spells of food stamp participation,
longer spells of food stamp nonparticipation, and higher
rates of employment than did households not subject to
the policies. In addition, adult-only households were
much more likely to leave the FSP at recertification time
than at other times. Finding employment hastened exits
from the FSP and delayed returns.
Goal 6: Protect and Enhance the Nation’s Natural
Resource Base and Environment.
Key Outcome
ERS research and analytical activities are designed to
enhance understanding by policymakers, regulators, program
managers, and those shaping public debate of economic
issues related to developing Federal farm, natural resource,
and rural policies and programs that protect and maintain
the environment while improving agricultural competitiveness
and economic growth.
Key Accomplishments
Assessing the Effectiveness of Voluntary Conservation
Programs. Recent ERS research addresses the question
regarding program participation.hich requires an understanding
of why producers participate in the programs, what incentives
encourage participation and how might policies be designed
to encourage participation. This report, Conservation-Compatible
Practices and Programs: Who Participates?, examines the
business, operator, and household characteristics of farms
that have adopted certain conservation-compatible practices,
with and without financial assistance from government
conservation programs. The analysis finds that attributes
of the farm operator and household and characteristics
of the farm business are associated with the likelihood
that a farmer will adopt certain conservation-compatible
practices and the degree to which the farmer participates
in conservation programs. For example, operators of small
farms and operators not primarily focused on farming are
less likely to adopt management-intensive conservation-compatible
practices and to participate in working-land conservation
programs than operators of large enterprises whose primary
occupation is farming.
Economic Briefs on Conservation Program Design.
Voluntary conservation payment programs must specify who
is eligible to receive payments, how much can be received,
for what action, and the means by which applicants are
selected. Achieving program goals in a cost-effective
manner hinges on the choices policymakers and program
managers make when answering these questions. A set of
five Economic Briefs explores specific design options
these decision makers face: balancing income support and
environmental objectives; whether and how to target programs
to improve cost effectiveness and environmental performance;
whether and how to use bidding in determining payment
levels; balancing land retirement with conservation on
working lands; and whether to pay for conservation practices
or to link payments to environmental performance.
Balancing the Multiple Objectives of Conservation
Programs. Many of the Nation’s conservation
programs use an index approach to prioritize environmental
and cost objectives. In an index, objectives are weighted
by relative importance. This report provides empirical
evidence on the cost and environmental benefit tradeoffs
of different weighting schemes in USDA’s Conservation
Reserve Program (CRP) and considers how different schemes
induce different sets of landowners to offer land for
enrollment. The report finds that while small changes
in index weights do not markedly affect levels of environmental
benefits that can be achieved at a national level, larger
changes can have a moderate impact.
Major Uses of Land in the U.S., 2002. This publication
presents the results of the latest (2002) inventory of
U.S. major land uses, drawing on data from the Census,
public land management and conservation agencies, and
other sources. The data are synthesized by State to calculate
the use of several broad classes and subclasses of agricultural
and nonagricultural land over time. The United States
has a total land area of nearly 2.3 billion acres. Major
uses in 2002 were forest-use land, 651 million acres (28.8
percent); grassland pasture and range land, 587 million
acres (25.9 percent); cropland, 442 million acres (19.5
percent); special uses (primarily parks and wildlife areas),
297 million acres (13.1 percent); miscellaneous other
uses, 228 million acres (10.1 percent); and urban land,
60 million acres (2.6 percent). National and regional
trends in land use are discussed in comparison with earlier
major land-use estimates.
Environmental Effects of Agricultural Land-Use Change:
The Role of Economics and Policy. Research examined
evidence on the relationship between soil productivity,
environmental sensitivity, and the physical characteristics
of crop and grazing and forest lands that have and have
not changed use between 1982 and 1997. The report also
estimates land-use and environmental impacts stemming
from a growth in crop insurance subsidies during the 1990s
and from the CRP. On average, lands transitioning between
cultivated cropland and less intensive agricultural uses
are more erodible than other lands in these uses, both
nationally and locally. These lands are also associated
with greater nutrient runoff and leaching compared with
cultivated cropland nationally. Crop insurance and CRP
are estimated to impact land use on lower quality and
some environmentally sensitive lands. However, these lands
differ geographically and environmentally from each other,
and from other lands transitioning to and from crop production.
While the estimated aggregate impacts are small (less
than 1 percent of cultivated land), we estimated that
the increase in crop insurance subsidies over 1992-97
primarily affected land use on low quality and some environmentally
sensitive lands, such as wetlands and highly erodible
land. Lands in CRP are generally less productive and more
prone to erosion damage -- but not nutrient runoff and
leaching -- than the average cropland area. Lands affected
by crop insurance subsidies and CRP differ from each other
and from other croplands relative to imperiled species
habitat, but no causal relationships can be determined
from the data.
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