Three Essays on Exogenous Shocks in Rural Areas: Land Conservation Policies and Natural Disasters
Open Access
- Author:
- Fleming, David Alexander
- Graduate Program:
- Agricultural Economics
- Degree:
- Doctor of Philosophy
- Document Type:
- Dissertation
- Date of Defense:
- January 24, 2012
- Committee Members:
- David Gerard Abler, Dissertation Advisor/Co-Advisor
David Gerard Abler, Committee Chair/Co-Chair
Stephan J Goetz, Committee Member
Jill Leslie Findeis, Committee Member
Gary E Bolton, Committee Member - Keywords:
- Land policy
Natural Disasters
Chile
Trust
Social Capital - Abstract:
- This dissertation is composed of three different essays that use different methods, data and case studies. The three essays, respectively (as presented here), cover the analysis of a land based policy using regional level data in the US, the effect of social capital in post–shock environments using community and household level data from Chile, and the use of experimental economics to evaluate individual behavioral changes after the 2010 earthquake in rural areas of Chile. Thus, even though this dissertation seeks to investigate three different topics, they merge in the main core of their purpose: the analysis of how exogenous shocks –given in the essays by governmental and natural interventions– affect the economic structures of rural areas and human response. The focus of this dissertation is on how rural people respond to land conservation policies and the occurrence of natural disasters. The first essay investigates the slippage effects of the Conservation Reserve Program (CRP), an extensive agricultural land retirement effort implemented in the US during the last 25 years by the US Department of Agriculture. The main purpose of this land conservation program is to reduce soil erosion due to agricultural activity as well as other negative environmental impacts generated by crop production. In terms of rural development, to study the objectives, functionality, and final outcomes of land based policies is highly relevant given that this exogenous intervention (if the policy comes from federal regulation) produces direct and indirect responses in the population living on and in the surroundings of retired land. In particular, the CRP generates multiple outcomes that have been widely investigated by academics; however, there is one important issue that has not being deeply researched and that deserves more attention in order to obtain a better understanding of the indirect outcomes of conservation programs in farmer decisions: how land put under conservation affects the likelihood of land use conversion in non–protected surrounding areas. This phenomena, denoted in the literature as land slippage effects, is understood as the conversion of non protected land to agriculture as consequence of other agricultural land being retired by the CRP. Based on past works of Wu (2000, 2005) and Robert & Bucholtz (2005, 2006), I analyze the slippage produced by this program using a data set that has not been much explored in empirical economic studies: satellite land cover change information from the US Geological Survey, aggregated at county level. The study area consists of 1,053 counties located in the Midwest states of the US. Results support the existence of slippage effects from the CRP, but they are more conservative than the ones found by Wu (2000). The evidence of slippage provided here is important information for planners, given that whether and how the CRP affects land use decisions in surrounding areas is key information for implementing conservation efforts more efficiently. The second essay analyzes another kind of shock that affect the economic structures of rural (and non–rural) areas: natural disasters. After the occurrence of natural disasters rural households may opt for one of more coping strategies to recover pre-shock welfare levels. Although previous economic researches have analyzed factors influencing household decisions regarding coping strategies, none have analyzed the role that social capital may play in the access and use of coping strategies by households in areas affected by natural disasters. This research, using data from surveys implemented in households of rural villages severely affected by the 2010 Chilean earthquake, investigates this issue by analyzing the incidence of different types of social capital over the probability that a household face for accessing and using a particular coping strategies. Results show that, after controlling for household characteristics and the damages that these suffered from the earthquake, social capital does matter for the accessibility and use of diverse sources of help and recovery. Results are relevant for planers aimed to recover regions after natural disasters, and complement former empirical works that have shown that social capital is a critical factor to promote economic growth. The third essay follows the line of research of the second proposal in geographic scope and shock event: the case of rural areas in Chile that were affected by the 2010 earthquake. However, the difference is that in this essay, behavioral economics is the main focus. Peoples’ behavior in the aftermath of natural disasters may depend critically on various conditions. In this paper we postulate three conditions, likely to occur after massive natural disasters, that can adversely affect the trusting behavior of people within communities: rivalry for scarce relief and recovery recourses, incremental information asymmetries between agents (what we call aftermath moral hazard) that provides excuses to break previously established social contracts, and migration or social displacement of people. To investigate these issues a series of trust games were conducted in Chile to analyze whether the 2010 earthquake affected the trust and trustworthiness of villagers in rural areas. Experiments were conducted one year after the occurrence of the earthquake in a group of villages severely affected by this disaster and in a group of villages that were not affected (villages that serve as control group). Game outcomes and additional socioeconomic data collected through surveys are compared and analyzed using statistical tests and regressions. We find that trust levels (and most socioeconomic characteristics of participants) are not statistically different between groups. However, we find that trustworthiness levels of people in the affected villages are lower than levels observed in the control villages, supporting our hypothesis that aftermath conditions can negatively affect trusting behavior.