1 The Allocation of Conservation Reserve Program Acreage: A Political Economy Perspective

The United States Department of Agriculture’s Conservation Reserve Program (CRP) is the largest federally-funded private-land conservation program. In this program, landowners retire environmentally sensitive agricultural land for 10 to 15 years to a conservation cover and, in exchange, receive annual rental payments and incentives for maintaining the conservation practice on the parcel. During the 2006 program year, landowners enrolled in the program received approximately $1.8 billion in rental payments for idling 36.7 million cropland acres (USDA 2007a). The program uses an Environmental Benefits Index (EBI) to rank offers of enrollment based on the offers ’ provisions of environmental benefits and cost. There is evidence in the literature that land enrolled in the CRP may not achieve environmental benefits at the lowest cost and that perhaps other targeting schemes could reduce program outlays and increase environmental benefits (Babcock et al. 1996, 1997; Reichelderfer and Boggess 1988). It is plausible that we observe “sub-optimal ” enrollment in the program for the very reasons other federal subsidy and direct payment programs exhibit distributional effects associated with political factors: politics matters. The primary objective of this paper is to utilize information about the cross-sectional allocation of CRP enrollments over time and the underlying political environment in which allocation decisions were made to make inferences about the effect of political factors and political influence on th