Agricultural tillage practices are important human-induced activities that
can alter carbon emissions from agricultural soils and have the potential t
o contribute significantly to reductions in greenhouse gas emission (Lal et
al., The Potential of U.S. Cropland, 1998). This research investigates the
expected costs of sequestering carbon in agricultural soils under differen
t subsidy and market-based policies. Using detailed National Resources Inve
ntory data, we estimate the probability that farmers adopt conservation til
lage practices based on a variety of exogenous characteristics and profit f
rom conventional practices. These estimates are used with physical models o
f carbon sequestration to estimate the subsidy costs of achieving increased
carbon sequestration with alternative subsidy schemes.