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The Effects of Ethanol on the Economy

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The Effects of Ethanol on the Economy
The Effects of Ethanol on the Economy

ECON 203

May 3, 2007

The Effects of Ethanol on the Economy

Corn crops are responsible for producing numerous valuable resources and products and therefore, corn is a vital part of the nation’s agricultural industry. One of the most valuable products derived from corn is ethanol. Due to the demand for ethanol corn has experienced an increase in value. Farmers are able to charge more for their crop resulting in an increase in price for many other products that rely heavily on these crops. The high demand for products produced from corn have caused many farmers to abandon their original crops and start farming corn in order to tap into the highly profitable corn market. This topic has sparked much debate over the efficiency of this source of energy. The most popular use for Ethanol is as a fuel. It is a clean-burning fuel that is produced from renewable sources. This grain alcohol is formed from crops like corn. Since ethanol is domestically produced it reduces America’s dependence on foreign countries for energy sources. There are many benefits of using ethanol as an energy source. It has had a positive effect on the local, state, and national economy. Small farm towns where the crops are grown and processed reap the benefits of having a locally produced energy source and vehicle drivers all over the country benefit from being able to purchase a locally created fuel. The job opportunities created from the construction of ethanol plants are endless. With additional jobs comes additional household income. Agriculture, farmers and rural communities have also experienced many advantages. The production of ethanol has led to the development of rural areas because of the demand for corn and other agricultural products used in the making. Since corn plays such a large role in the ethanol industry, corn farmers are able to make more of a


Cited: Harder, Ben. “Demand for Ethanol May Drive Food Prices Up”. 22 Jul. 2006. Science News Online Morrison, Deane. “Biodiesel Edges Out Ethanol”. 18 Jul. 2006. Renewable Energy Access Reynolds, Dean. “As Cars Go Green, Food Prices Will Jump”. 9 Apr. 2007. ABC News
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