Promising Research Directions for Measuring the Economic Benefits of Soil Health

Increasing soil health by planting cover crops and using no-till planting methods has been an option for farmers for decades but adoption of these methods is low because they cost more and the grower usually does not experience any immediate economic benefits. According to data from 2017, only about 4% of US farmland had a winter cover crop and about 37% of farm acreage is planted using no-till methods. Now, policymakers are considering sharing the economic burden of planting cover crops, like hairy indigo pictured above, and incentivizing no-till planting because soil health also allows for more carbon sequestration. Capturing carbon benefits the public because it slows the greenhouse gases causing climate change. Economists have a role to play in shaping agricultural policy by measuring the value of soil health and in turn carbon sequestration.

In a recent article in the Journal of Soil and Water Conservation, Professor Roderick Rejesus, postdoctoral researcher Serkan Aglasan and their colleagues from the USDA identified several areas of research where economists can contribute to the discussion of how to address soil health. Assessing the value of non-market goods, such as carbon sequestration, is important to policymakers who want to invest in soil health; however, it is not an easy task.

Researchers need more data to evaluate the long-term financial benefit to the public of carbon sequestration as well as the value of healthy soil which makes farms more resilient to environmental pressure. Studies measuring the economic benefits of soil health should be conducted for longer periods of time since the benefits of of healthy soil practices likely accumulate over time. Researchers also need more observational data from broader geographical regions. The studies will need to be dynamic and responsive to the various conditions each location experiences during the season.

The challenges of measuring the economic value of non-market goods like carbon sequestration is an area that agricultural economists can provide valuable research and analysis. As policymakers better understand the societal benefits of soil health, they can decide to what extent the public should share the cost of adopting healthy soil practices. Compensation, through subsidies, is being explored by the current administration and economists can play a role in making fair and equitable decisions. Showing positive economic outcomes from farming practices that boost soil health and make farms more productive while they play a role in addressing climate change could increase the numbers of farmers willing to utilize cover crops and practice no-till methods.