The Incidence of U.S. Agricultural Subsidies on Farmland Rental Rates
By Barrett E. Kirwan. Journal of Political Economy, 2009
285 citations recorded by the source corpus.
Who benefits from agricultural subsidies is an open question. Economic theory predicts that the entire subsidy incidence should be on the farmland owners. Using a complementary set of policy quasi experiments, I find that farmers who rent the land they cultivate capture 75 percent of the subsidy, leaving just 25 percent for landowners. This finding contradicts the prediction from neoclassical models. The standard prediction may not hold because of less than perfect competition in the farmland rental market; the share captured by landowners increases with local measures of competitiveness in the farmland rental market.
Subfields: Economics and Econometrics, General Agricultural and Biological Sciences, Soil Science
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In Economics and Econometrics
In General Agricultural and Biological Sciences
In Soil Science
Citations in the corpus
- The Incidence of EU Per-Hectare Payments on Farmland Rental Rates: A Spatial Econometric Analysis of German Farm-Level Data (2011, methodology): “Kirwan (2009) uses 1997 fixed government payments as leads to instrument 1992 subsidy payments.”