We investigate effects of corn-based ethanol plants on local land uses using county-level panel data for Iowa for 1997 through 2009 and an Arellano-Bond difference-generalized method-of-moments estimator. Our results show that ethanol plants have statistically significant effects on the proportion of acres planted to corn in the plants’ host counties. Furthermore, ceteris paribus, the land-use-change effect of locally owned plants (owned by local farmers or cooperatives) is about twice as large as the effect of plants with nonlocal owners. We also explore implications for the environment of ethanol plants and the changes in land use that they induce.
