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Agricultural land use change has long been of a considerable interest to agricultural and resource economists. With a focus on western Lake Erie basin, the objective of this paper is to identify the determinants of recent land use transitions from non-agricultural land into cropland and investigating the environmental impacts of these recent changes in terms of agricultural nutrient runoffs. Specifically, we analyze the transitions from non-crop rural land into different crop rotation patterns using a mixed logit model with error components that relaxes the IIA assumption. We then investigate the environmental effects of these changes using an existing watershed hydrological model – Soil Water Assessment Tool (SWAT) by translating the land use changes into changes in nutrient runoff into Lake Erie, focusing particularly on dissolved phosphorus.By analyzing the operators’ field-level decisions of transitioning non-cropland into crop production and its environmental impacts, our model provides useful insights into recent trends of expanding agricultural production. This work also contributes to the literature on coupled economic-ecological models by offering the first SWAT application on land use transitions into and out of agriculture.


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