Abstract
This study investigates the extent to which the 2005 Renewable Fuel Standard (RFS) has affected farm structure, in particular farm size. Our empirical strategy relies on the opening of an ethanol plant in a farmer’s local neighborhood. We identify the effect of the RFS on the size of farms located in the vicinity of new ethanol plants. Using a unique farm-level panel dataset from the June Agricultural Survey (JAS), the empirical estimation employs two difference-in-difference (DD) propensity score matching models, one prior to the RFS mandate and one incorporating the RFS program, to estimate an average treatment effect on farm size of an ethanol production facility. We then measure the effect of the RFS program on farmland structure as the difference between these two DD matching estimators. Overall, our results suggest that the RFS program raised the probability of farm size increase by roughly 12 to 18%, on average, for farms located within a 30-mile radius of new ethanol plants. In addition, the program contributed to a net increase in farm size of 25 to 32%, on average, for those spatially advantaged farms.
Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
