The impact of pasture insurance on farmland values

This study examines the impact of publicly supported insurance on agricultural land values. The analysis employs confidential, nationally representative panel data on field-level pastureland values and exploits a natural experiment provided by gradual introduction of the Pasture, Rangeland, and Forage Insurance Pilot Program. We use afield-level fixed-effects model that controls for several timevariant factors. We find that insurance availability is associated with an increase of at least 4 percent in pastureland values. This increase is comparable with increases generated by other government programs but is much smaller than total farmland value increases experienced in recent years.