National, state and local economic influences of United States environmental policy and animal agriculture

Abstract

My dissertation attempts to test the relationship between the US livestock industry and environmental policy in two distinct areas: In Part 1, the potential influence of difference in state level environmental policy on the location and inventory decisions across four principal livestock sub-industries is evaluated; beef cattle, dairies, poultry and hogs. In Part 2, I use a spatial hedonic approach to estimate the influence of livestock operations on residential housing prices in a fast growing, but traditionally agricultural area of Northern Colorado.

Results from Part 1 indicate that, in general, traditional economic factors are still important to farm level inventory decision making, but their influence varies across operation size. There are distinct effects of written stringency and evidence of the willingness to enforce environmental policy. Policy enforcement activity was shown to influence stocking decisions, and the impact was more sensitive on larger than smaller operations. Further, environmental policy’s influence differs by livestock species. The hog industry, with rapid structural change, is more sensitive than the beef industry, with less structural change, to changes in the policy milieu.

Results from Part 2 indicate that the number of beef and dairy operations positively influence real estate values, potentially signaling a positive rural lifestyle effect. However, the number of hog and sheep operations has the opposite effect. In addition, the influence of the livestock sector on housing prices differs by house value. The cheaper the house, the more negative is the impact of an additional livestock operation. On the other hand, the higher the housing value, the more negative is the impact of more animals, or size of operation rather than number of operations. As expected, impacts decrease with increasing distance from the housing unit to the livestock operation.