The economics of tillage for large-scale mechanized farms

Abstract

Economically rational farmers base tillage choice decisions on comparisons of resources requirements, production, costs, crop yields and short-term net returns across alternative systems. Also deserving consideration are the adverse effects of tillage on soil erosion and longer term productivity, which in turn affect longer term net returns, and the comparative riskiness of tillage alternatives, as measured by variability of net returns. Most empirical evidence indicates the superiority of conservation tillage systems for both crops and small grains, especially where produced in warm climates, on shallow soils, and on sloping terrain. The same conservation tillage systems tend to carry a higher risk loading, so that risk-averse farmers may prefer more erosive conventional tillage systems, despite the lower profitability. While farmers may be able to ignore the off-set costs of downstream watercourse pollution caused by soil erosion, society is increasingly concerned about such costs. Unless more farmers adopt conservation tillage systems voluntarily, increased public intervention may be demanded society at large. Such intervention could reduce the farmer's freedom to choice, but could also involve financial assistance programmes, since the latter can be justified on economic grounds.