THE ECONOMIC VALUE OF FARM PROGRAM BASE

Mixed integer programming and dynamic programming models were used to obtain the implicit economic value of the initial endowment of base ac reage on a cotton farm. While low levels of initial base have almost n o impact on land value, high levels can be worth a considerable premiu m, with the implicit value of additional initial base endowment increa sing at an increasing rate. This pattern of increasing implicit value can be explained by provisions of the farm program allowing base to be created by a landowner who develops a planting history in a program c ommodity.