The International Leakage Effects of Land Retirement: Evidence from The Conservation Reserve Program

With the significant rise in U.S. agricultural exports over the past 25 years, domestic policies, such as the Conservation Reserve Program, significantly influence global agricultural markets and food security, impacting farm households worldwide. This study utilizes a modified Global Trade Analysis Project Agro-Ecological Zone model to assess the impacts of expanding the Conservation Reserve Program in the U.S. on global agricultural markets. Preliminary findings suggest that an expansion of the Conservation Reserve Program in the U.S. will decrease cropland and pastureland on a global scale. Even though there are some increases elsewhere, these increases are not enough to offset the decrease in the U.S., and the expansion also results in a reduction of forest areas worldwide. Retiring additional land decreases crop production and causes land prices to rise across all Agro-Ecological Zones, influencing commodity prices and affecting international trade patterns.