In April of 2015 Dr. William Larson, previous Research Economist at the Bureau of Economic Analysis finished research on, “New Estimates of Value of Land of the United States”. He began describing how “land is an important and valuable natural resource, serving both as a store of wealth and as an input in production”. Dr. Larson’s research describes the estimated value of all the land in the United States with an estimated value of 1.89 billion acres worth around 23 trillion-dollars in 2009. Even more interesting, he analyzes the total value of the lower 48 states.
As Wyomingites and proud residents of this beautiful cow country, we place a high value on our land. Despite our individual thoughts, Dr. Larson’s paper explains otherwise. Of the 1.89 billion acres of U.S. land, agricultural land contributes 47 percent; federal government lands reach 24 and at the lowest developed or urbanized land are at 6 percent. Nearly half of the U.S. soil is occupied by agriculture, yet of the 23 trillion-dollar value of the U.S. land, only eight percent of the assets are contributed by agriculture.
On the other hand, developed and urbanized land totals 51 percent of the 23 trillion-dollar estimate. Six percent of the urbanized U.S. land, values at around 12 trillion-dollars. How should agriculturalist make sense of land values and its use based on this research?
Using many sources listed in his published paper, Dr. Larson’s total estimate describes that developed land is worth on average 106 thousand dollars per acre, while agriculture land is only worth on average two thousand dollars per acre. So where does Wyoming fall on the value list? Unfortunately this places Wyoming last on the list. The Cowboy State only contributes 62 million acres of land worth only 90 billion dollars, the lowest out of all the states. The reason for this calculation is that Wyoming has large amounts of agriculture land and federally owned land, which according to Dr. Larson’s paper are the two lowest valued lands of all the uses. The research argues that low development contributes to Wyoming’s placement in the research. Only one percent of Wyoming is developed, as a result Wyoming suffers for their lack of little urbanization on the scale of land value. According to Dr. Larson’s research, developed areas increase the value of the land by almost 100 thousand-dollars.
After reading the recently published research by Dr. Larson, I question the consequences, both good and bad that may follow as a result. Although the paper was not biased and was factually based, this document may create more awareness of for land values per state. If urbanized lands are considered to hold a higher value and “store more wealth as an input in production” individual states may push for urbanization throughout their borders.
Wyoming residents enjoy the wide open spaces and the culture that is provided with large agriculture production. So as agriculturalist how can we strive to increase the value of our lands? In the research certain factors determine the value of land which include; the land type, ecosystems currently existing on the land, importance of the area and urbanization. Urbanization includes transportation costs and potential development.
Well one thing is for sure, agriculturalists understand the importance of their land. Agriculture land sustains life providing food for humans and other species. With the global population rapidly growing, agriculture land use is becoming extremely important. The demand is growing for agriculture production and the land supply is limited in result the value agricultural land should only increase.
Agricultural land provides many more benefits than livestock or crop production, ag land provides a diversity of ecosystem services that are not available from developed land. Wildlife rely on agriculture land to reproduce and sustain life, including varieties of species from rodents, to birds and large elk and deer. Not only does agricultural land support animal species but it provides various habitats for plant and insect species that are vital to the production of crops and vegetation. By being good stewards of the land and becoming more sophisticated in the marketing of these ecosystem services, there is potential to increase the value of agricultural land.
There are ways for agriculturalists to increase the value of their lands including, making their lands more accessible, placing conservation easements, or otherwise marketing the conservation services that they provide. If you are interested in further information Dr. William Larson’s recent study is linked below, you might be surprised what there is to learn.
http://www.bea.gov/papers/pdf/new-estimates-of-value-of-land-of-the-united-states-larson.pdf
Written by: Kadi Davis, WSGA Summer Intern
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