How and Where Do Financial Incentives Promote Adoption of Climate Smart Agricultural Practices?

Last registered on August 06, 2024

Pre-Trial

Trial Information

General Information

Title
How and Where Do Financial Incentives Promote Adoption of Climate Smart Agricultural Practices?
RCT ID
AEARCTR-0014076
Initial registration date
July 30, 2024

Initial registration date is when the trial was registered.

It corresponds to when the registration was submitted to the Registry to be reviewed for publication.

First published
August 06, 2024, 1:21 PM EDT

First published corresponds to when the trial was first made public on the Registry after being reviewed.

Locations

Region

Primary Investigator

Affiliation
Virginia Tech

Other Primary Investigator(s)

PI Affiliation
Virginia Tech
PI Affiliation
University of Texas at Austin
PI Affiliation
Virginia Tech

Additional Trial Information

Status
In development
Start date
2024-02-20
End date
2027-06-30
Secondary IDs
Prior work
This trial does not extend or rely on any prior RCTs.
Abstract
Despite the high public benefits of climate smart agricultural practices, individual producers may not adopt them due to lack of perceived individual benefits or insufficient startup capital. In a rare opportunity to more closely align public and private benefits and overcome these initial capital constraints, we secured funding through USDA's Partnerships for Climate Smart Commodities program to evaluate the factors that incentivize adoption of on-farm climate smart practices. Staff from local soil and water conservation districts in four states—Arkansas, Minnesota, North Dakota, and Virginia—have been tasked with recruiting producers to apply for the program. We are conducting a stratified random selection process to offer producers a flat rate of $100 per acre (or animal unit) for any practice that qualifies under USDA guidelines. We will conduct surveys throughout the study period among selected and non-selected producers to evaluate differential adoption of CSA practices in response to these offers and translate those differences into estimated public benefits. We will evaluate whether capital alone appears sufficient to drive adoption of practices, and which practices are most likely (or least likely) to be adopted. We also evaluate the effectiveness of our program on reducing the GHG emissions of agricultural production and effects on agricultural productivity.

Registration Citation

Citation
Benami, Elinor et al. 2024. "How and Where Do Financial Incentives Promote Adoption of Climate Smart Agricultural Practices?." AEA RCT Registry. August 06. https://doi.org/10.1257/rct.14076-1.0
Sponsors & Partners

Sponsors

Partner

Experimental Details

Interventions

Intervention(s)
Intervention Start Date
2024-08-15
Intervention End Date
2025-12-31

Primary Outcomes

Primary Outcomes (end points)
a. Binary adoption of climate-smart agricultural practices (CSAPs).
b. Specific CSAPs adopted.
c. Planned and actual acreage (or animal units) enrolled under each practice. (Note that our payment scheme considers animal units equivalent to acres. While the rest of this document refers to acres and not to animal units, producers may enroll animal units in CSAPs.)
d. Expected or anticipated yields or production on the acres for which CSAPs are implemented and on the acres without CSAPs.
e. Actual yields, production, profits on the acres for which CSAPs are implemented and on the acres without CSAPs.
f. Input usage: Labor, machinery, fertilizers, irrigation water, etc. on the acres for which CSAPs are implemented and on the acres without CSAPs.
g. GHG emissions before and after the adoption of CSAPs: will be calculated using COMET Planner or COMET FARM based on farm/plot data provided during enrollment.
Primary Outcomes (explanation)

Secondary Outcomes

Secondary Outcomes (end points)
Secondary Outcomes (explanation)

Experimental Design

Experimental Design
Our experiment involves several steps, including recruiting relevant state partners and local soil and water conservation districts and co-designing the features of the experiment (especially with respect to recruitment and selection processes).

The initial recruitment phase began in January 2024, with partner organizations in each state publicizing the program and the application process. We piloted the application and selection process for two states (North Dakota and Virginia) in February 2024, with additional rounds of application and selection for all states to follow. As part of their applications, farm producers provide basic data about their farm and the number of acres they would like to enroll in the program. In addition, applicants must specify which practices they plan to adopt, for which crops and acres. (Our program excludes producers from receiving multiple sources of payments for implementing climate-smart or conservation practices on the same acreage.) Applicants must also agree to participate in a detailed data collection process (using either the COMET Farm or COMET planner software) to help researchers quantify the greenhouse gas emissions associated with the farm and how other production practices may have changed after adopting CSAPs.

To evaluate treatment effects of participation in the program, the total amount of funding requested across the pool of applicants must exceed the total amount of funding available so that we are able to select applicants into treatment and control groups. Equity in participation in USDA programs has been an important issue historically, and in this project we allocate more funding per acre to limited resource (LR) producers and historically underserved (HU) producers. (Both groups are defined by USDA.) We have also set targets for the share of payments that must go to LR and HU producers and the share of farmer participants who are LR or HU producers. Hence, for each round of applications we will generate a funding target based on the amount of total funding available (split equally among four states), the planned number of rounds of applications in each state, and the equity targets. Before selection takes place for each round, we will estimate the number of producers who will need to be selected to reach that funding target. A random sampling procedure will be used to sort applications, and treated producers will be those who appear first among the randomly sorted list. Depending on the number of applicants and funding amount requested, limited resource producers and historically underserved producers may be selected at a greater frequency than non-underserved producers to meet equity targets.

In addition, we are working with a survey firm to obtain information about farms that have not applied for funds through our project to serve as a secondary control group.
Experimental Design Details
Not available
Randomization Method
A random sampling procedure (with a seed selected each time by a member of the project team) will be used to sort eligible applicants randomly.
Randomization Unit
Farm (uniquely identified by USDA Farm Service Agency ID number).
Was the treatment clustered?
No

Experiment Characteristics

Sample size: planned number of clusters
N.A.
Sample size: planned number of observations
Based on the number of applications received and the amount of funding requested in the pilot rounds of application and selection for North Dakota and Virginia, we anticipate that in future funding rounds, we will have approximately 5,100 applicants.
Sample size (or number of clusters) by treatment arms
Approximately 3,200 treatment applicants (program participants) and 1,900 control (non-selected) applicants.
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
IRB

Institutional Review Boards (IRBs)

IRB Name
Virginia Tech IRB
IRB Approval Date
2023-06-01
IRB Approval Number
23-606