Does Spatial Dependence Affect the Intention to Make Land Available for Bioenergy Crops?

We find spatial dependence in landowners’ stated intentions to make land available for bioenergy crops. Our data are generated from a contingent valuation survey of 599 owners of marginal land in southern Michigan. Employing a Bayesian framework and using these spatially explicit data, we estimate and compare non‐spatial probit and spatial Durbin probit models to examine the presence of spatial dependence in land rental intentions. Results show that intentions to rent land for bioenergy crop production are spatially dependent. This spatial dependence arises both from the land supply intentions of nearby landowners and from spatial spillover effects of landowner characteristics and attitudes towards environmental amenities and the disamenities of land rental. We show that ignoring spatial dependence in the intentions of neighbouring landowners to participate in land rental markets for bioenergy feedstocks can lead to distortions that underestimate total effects. Our finding implies that studies of land use and crop supply should test for spatial interactions in order to make accurate inferences.