Analysis of Incentives for Grassland Conversion and Retention in the United State Prairie Pothole Region
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Over the last century, much of the United State prairie pothole region has been converted to cultivated cropland. Concerns have been raised on government subsidized crop insurance effect on grassland to cropland conversion in the United States. Most grassland in the United State prairie pothole region are privately owned making a vivid understanding of landowners’ response to crop insurance subsidies important to facilitate effective design of prairie pothole conservation programs. The purpose of this study was to determine the extent of land use conversion with the removal of crop insurance subsidies in the United States prairie pothole region. Government subsidies on crop insurance was determined to have a measurable impact on Conservation Reserve Program land acreage within the United States. It was estimated that a 15% reduction in the net returns to cropland resulted in about 274,000 increase in the land acreage of the Conservation Reserve Program. In Conclusion, the removal of crop insurance subsidies was predicted to slow down but not stop the conversion of grassland to cropland in the United States prairie pothole region.