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Agricultural Land Retirement and Slippage: Lessons from an Australian Case Study

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  • Iain Fraser
  • Robert Waschik

Abstract

This paper uses a Computable General Equilibrium (CGE) model to examine the economic implications of agricultural land retirement from wool production for conservation in Australia. Employing an innovative specific-factors characterization of production to generate short-run and long-run results, we show that the potential welfare gains from land retirement can be significant. However, in several scenarios examined we find that slippage in agricultural production is significant, resulting in reduced welfare. Our slippage results provide insights into the relationship between the potential causes of slippage and describe how a land retirement policy can be designed to minimize this effect.

Suggested Citation

  • Iain Fraser & Robert Waschik, 2005. "Agricultural Land Retirement and Slippage: Lessons from an Australian Case Study," Land Economics, University of Wisconsin Press, vol. 81(2).
    • Handle: RePEc:uwp:landec:v:81:y:2005:i:2:p206-226
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Miguel Cantillo, 2015. "Dynamic Investment with Adverse Selection and Moral Hazard," Working Papers 201501, Universidad de Costa Rica, revised Mar 2015.
    2. Jennifer M. Alix-Garcia & Elizabeth N. Shapiro & Katharine R. E. Sims, 2012. "Forest Conservation and Slippage: Evidence from Mexico’s National Payments for Ecosystem Services Program," Land Economics, University of Wisconsin Press, vol. 88(4), pages 613-638.
    3. Xie, Hualin & Jin, Shengtian, 2019. "Evolutionary Game Analysis of Fallow Farmland Behaviors of Different Types of Farmers and Local Governments," Land Use Policy, Elsevier, vol. 88(C).
    4. David A. Fleming, 2014. "Slippage effects of land-based policies: Evaluating the Conservation Reserve Program using satellite imagery," Papers in Regional Science, Wiley Blackwell, vol. 93, pages 167-178, November.
    5. Fraser, Iain & Waschik, Robert, 2013. "The Double Dividend hypothesis in a CGE model: Specific factors and the carbon base," Energy Economics, Elsevier, vol. 39(C), pages 283-295.
    6. Juan Robalino & Alexander Pfaff & Laura Villalobos, 2015. "Deforestation spillovers from Costa Rican protected areas," Working Papers 201502, Universidad de Costa Rica, revised Sep 2015.
    7. Matthew Freeman & Christopher Anderson, 2013. "Modeling Effort and Lobbying in a Heterogeneous Common Pool Resource Setting," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 56(3), pages 399-414, November.
    8. Iain Fraser & Robert Waschik, 2010. "The Double Dividend Hypothesis in a CGE Model: Specific Factors and Variable Labour Supply," Working Papers 2010.02, School of Economics, La Trobe University.
    9. Raja Chakir & Alban Thomas, 2020. "Unintended consequences of environmental policies: the case of set-aside and agricultural intensification," Working Papers hal-02482207, HAL.
    10. Hualin Xie & Qing Wu, 2019. "Analysis of Fallow Farming Decision-Making Behavior of Farmers Based on Hawk-Dove Game Theory: The Case of Guizhou Province," Sustainability, MDPI, vol. 11(14), pages 1-15, July.
    11. Yan, Youpei, 2017. "Unintended Land Use Effects of Afforestation in China," 2017 Annual Meeting, July 30-August 1, Chicago, Illinois 258280, Agricultural and Applied Economics Association.
    12. Xie, Xianxiong & Cui, Yu & Yao, Liuyang & Ni, Qi & Khan, Sufyan Ullah & Zhao, Minjuan, 2022. "Does fallow policy affect rural household income in poor areas? A quasi-experimental evidence from fallow pilot area in Northwest China," Land Use Policy, Elsevier, vol. 120(C).
    13. Hung-Hao Chang, 2017. "Does A Social Welfare Program Affect Farmland Use? Empirical Evidence Using Administrative Data in Taiwan," Applied Economic Perspectives and Policy, Agricultural and Applied Economics Association, vol. 39(3), pages 441-457.

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    JEL classification:

    • C68 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computable General Equilibrium Models
    • Q24 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Land

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