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The agri-environment-climate measures of the European Union Common Agricultural Policy are incentives aiming to reduce negative environmental impacts and increase positive effects generated from agriculture. Several criticisms have been addressed to their efficiency and effectiveness and thus, the design of innovative contract solutions is currently suggested. Among the novel contractual solutions, there are result-based payments, collective implementation of measures, the engagement of private and business actors in value chains, and new forms of land tenure systems coupled with environmental clauses. Little is known about the factors at interplay influencing farmers' decision to uptake such contracts. The present paper investigates the acceptability determinants of the above-mentioned novel contractual solutions concerning a sample of nearly 1900 farmers from 10 European Union countries. The analysis is based on a questionnaire built through a common research framework. We apply ordered logistic regressions: both proportional and partial proportional odds models are used. Farmers' preferences are interpreted by splitting the innovative contractual solutions into 13 individual contractual features which are then modeled in combination with the structural characteristics of the farms and the sociodemographic and behavioral characteristics of the farmers. We estimate farmers' willingness to enroll in result-based, collective, value-chain, and land tenure contracts and highlight the positive and negative factors potentially influencing farmers' acceptability of each type of contract. • Acceptability of result-based, collective, value chain, and land tenure contracts • Through ordered logistic regressions on 1866 farmers from 10 EU countries • Contractual design features matter (implementation details more than contract type) • Farmers have a good level of interest, but trade-offs in design and implementation • Managerial aspects/contractual design features matter vs. farms' structural characteristics [ABSTRACT FROM AUTHOR]

Abstract: Agri-environmental measures (AEM) are the central area-based measures of the second pillar of the Common European Agricultural Policy. Cost-effectiveness of AEMs has to be improved. In this paper a newly designed AEM called result-oriented incentive is empirically analysed for the first time concerning its impacts on environmental effects and cost. Result-oriented financial incentives are linked directly to the desired environmental objectives and allow farmers to choose the most efficient way of management to reach them on their own. In this paper, we present the results of 90 interviews with farmers who have participated in a result-oriented AEM in Baden-Wuerttemberg (Germany). We investigated potential advantages (flexibility, innovation, higher intrinsic motivation and improved continuous adaptation). In addition, we researched disadvantages (transaction costs involved in control efforts, risk for farmers). Our results show that such kind of AEM has a positive impact on cost-effectiveness. However, the concrete design and the implementation process of these AEMs play a crucial role for their successful application. [Copyright &y& Elsevier]

Abstract: The sustainable management of soils, while constituting an important resource conservation concern in some contexts, has been neglected in the UK. However, this all seems set to change, with implications for various actors within the agricultural knowledge system. New policies designed to encourage the more sustainable management of soils in England together with the introduction of Soil Management Plans (SMP) as part of cross-compliance under recent Common Agricultural Policy reform mean that demands on agricultural advisors’ knowledge about soil will increase. This paper reports the findings of research into the nature and extent of agricultural advisors’ knowledge about soil best management practice. Specifically, it examines the ‘know-what’, ‘know-why’ and ‘know-how’ of soils among agricultural advisors through analysis of data collected from an extensive postal questionnaire survey of 162 advisors across England supplemented by qualitative data from semi-structured interviews with 64 advisors. The results show that as a community advisors are generally knowledgeable about soil best management practice and appear to be observing soil degradation, undertaking training, using guides, tools and recommending soil best management practice to a relatively large extent. The data however do indicate that different types of advisors hold different forms of knowledge to a different extent. They also reveal gaps in knowledge gained through practical experience about cultivation and using the nutrient value of manures. The paper concludes that advisors’ knowledge about soil and its sustainable management is considerably greater than earlier research on advisors’ environmental knowledge has suggested but that some areas will have to be significantly enhanced and standardised to meet the new policy challenges. The significance of the results is discussed in terms of the wider role advisors play in the transition from ‘production only’ goals towards those concerned with more sustainable practices in agriculture. [Copyright &y& Elsevier]

Agroforestry is considered a sustainable form of land management that optimizes the use of natural resources (nutrients, radiation, water). Agroforestry is defined as the deliberate integration of woody vegetation with agricultural activities in the lower story. It provides a higher biomass production per unit of land, while providing more ecosystem services than woody-less agricultural lands, such as the reduction of soil erosion and nitrogen leaching, and increase carbon sequestration and landscape biodiversity. The objective of this paper is to evaluate the past and current European Union Common Agricultural policies aiming at promoting the afforestation or reforestation of lands, as the introduction of trees can be seen as a first step to carry out agroforestry practices in former agricultural or forest lands. Agroforestry was a traditional land use system in Europe before modern times. However, before the sixties land intensification and consolidation destroyed millions of trees all over Europe. On the contrary, some good examples of agroforestry promotion are found in Eastern European countries in order to reduce the effect of extreme events such as winds, flooding at the beginning and mid of the last century. In Western European countries, the introduction of trees in the land has been promoted by agroforestry, afforestation and reforestation at the end of the last century. Afforestation of agricultural lands have been the most successful CAP measure (over 1 million hectares) while agroforestry measures were not extensively adopted which may be explained by the funds associated to afforestation measure which compensated the losses of income 15 or 20 years in afforested lands. Agroforestry was poorly adopted in the CAP 2007–2013, having a better success in the CAP 2014–2020 due to the recognition of woody vegetation and the compensation of 5 years given for maintenance once agroforestry is established. However, policy rules ensuring Pillar I payment when agroforestry measure is adopted such as a management plans ensuring that maximum tree density (100 trees per hectare) is not reached, should be pursued. [ABSTRACT FROM AUTHOR]

Originally conceived as a post-war policy vehicle for ensuring agricultural self-sufficiency, the Common Agricultural Policy (CAP) has evolved into a multifunctional instrument designed to satisfy a diverse portfolio of European Union (EU) policy objectives including nature protection. Notwithstanding, whilst the CAP has become more environmental and socially responsible, it is still expected to deliver an efficient farm production system capable of competing on world markets. The current paper combines a farm business panel dataset for 98 EU territories with a Stochastic Frontier Analysis (SFA) approach, to assess the impact of four contemporary broad categories of CAP subsidy programs on efficiency and environmental sustainability. In accordance with the literature, this study more correctly defines inputs as “facilitating”, whilst following recent methodological developments, crop-subsidies are treated as an endogenous strategic variable in the production function. Comparing between two discrete time periods, further tests are conducted to examine the hypothesis of technical efficiency convergence across european territories. The results suggest that first pillar crop subsidies and pillar two environmental programs generate a disincentive effect on productivity, whilst in general, the CAP promotes technical efficiency convergence within Europe. [ABSTRACT FROM AUTHOR]

This paper studies the effects of investment support from the common agricultural policy on labour and total factor productivity of agricultural firms in Sweden. Detailed firm-level data on 34 300 firms are used to estimate a matched panel model that relates firm productivity to a series of factors reflecting internal and external characteristics. The recently developed Coarsened Exact Matching method is used to estimate matched control groups and handle selection bias. Findings show a positive and significant treatment effect of investment support on firm productivity, but only for small firms. The analysis also reveals that an increase in the size of the support in relation to firm income has a negative and significant impact on productivity for all firms. Differentiating between various types of investment supports indicates heterogeneous treatment effects. The policy instrument can improve its efficiency if targeted to small firms and investments that have a link to public good provision. [ABSTRACT FROM AUTHOR]

Agricultural biodiversity conservation has been recognized as a fundamental resource for the maintenance of ecological and economic functions. In this paper, we test the hypothesis that the Common Agricultural Policy (CAP) has an impact on crop diversity decisions of farm managers. In so doing, we allow the diversity decision to depend on a rich set of economic and agro-ecological variables, such as prices of the most common cereal varieties, and agro-ecological and socio-economic characteristics at farm and regional level. Using a panel dataset over the period 2004–2010, we compare the results obtained from pooled-OLS and dynamic panel GMM estimators. The empirical analysis shows the existence of a positive relationship between CAP payments and diversity. In addition, decoupling subsidies from production seems to have a positive effect on biodiversity. [ABSTRACT FROM AUTHOR]

Abstract: This paper reports on the use of a spatial analysis framework to assess the consequences for business incomes of alternative area-bases for Pillar 1 CAP Single Farm Payments, integrating spatial data from both biophysical and socio-economic domains. The results from the Scotland analysis are likely to have wider significance for policy makers confronting decisions on how best to implement reforms of Pillar 1 CAP payments elsewhere in the EU. Introduction of area-based payment to replace historic entitlement is particularly challenging in regions with a wide range of bio-physical conditions that are spatially heterogeneous and only weakly related to intensity of agricultural use, management or previous support. The analysis shows that, while the basis of payments and payment rates can have substantial effects on the nature of the impact, it is the change to an area-based payment system alone that has the biggest redistributive impact. For Scotland, there are larger numbers of businesses that gain rather than lose, and, because the average losses are much larger than the average gains, a move towards area-based payments is likely to encounter strong opposition and only weak support from the agricultural community. In all the options for area-based payments examined, there is substantial redistribution between agricultural sub-sectors and between geographical regions. Substantial reductions in support affect agricultural sub-sectors that are significant for the wider agri-food sector (cereals, general cropping, dairy and lowland livestock) and regions where agriculture plays a significant role in the economy (particularly south-west Scotland). Yet the greater redistribution quantified by this research is within sub-sectors; that is from businesses with more intensive management to those with more extensive. Such within-sector redistributions will have policy significance and mean that analysis of the consequences of area-based payment options conducted only at sub-sectoral level is likely to be inadequate. It is concluded that the analysis approach used has successfully revealed the potential consequences of area-based CAP support payment options and this has been of direct value by informing ongoing negotiations on reform of the CAP. However, the research also highlights the serious challenges that remain in defining schemes that meet the objectives of policy makers, can be administered cost-effectively and are politically acceptable. The research may thus have implications for other EU member states considering how best to implement area-based Pillar 1 payment schemes. [Copyright &y& Elsevier]

Abstract: Diversification of the farm income base represents a cornerstone of the European model of multifunctional agriculture (MFA) and rural development (RD) alongside the objectives of enhancing competitiveness and the sustainability of agriculture. A knowledge gap exists as to how farmers’ decisions to engage in non-agricultural activities, or to continue farming at all, is affected by landscape characteristics and the farm''s location in the urban–rural system. This paper presents the results of research concerning the impact of spatial factors on diversification activities and farm abandonment. Based on a survey conducted among 147 farms in a case study area in Eastern Germany, spatially explicit data on farmers’ diversification activities and exit strategies were analysed using two spatial typologies that classify rural attractiveness and farm location on an urban–rural gradient. Results show that while rural attractiveness positively affects the farmers’ decision-making to diversify activities, the degree of urbanisation encourages farm holders to continue farming activity, i.e., the proximity and accessibility to urban consumer markets. Diversification rather seems to be associated with rurality and touristic development and not so much with the proximity to urban consumer markets. [Copyright &y& Elsevier]

Abstract: The objective of this paper is (i) to compare and discuss literature related to global and European outlooks in relation to the farming sector and rural areas and (ii) to provide an overview of policy modelling methodologies, especially but not only those used in assessing the impact of the Common Agricultural Policy (CAP). There is significant variation in terms of both the policies and external drivers that are taken into account in global and European outlooks, driven predominantly by the heterogeneity in focus of studies, the approach applied and/or external pressures. An increasing number of studies take on board the new CAP challenges. However, an area where improvements are needed is in the understanding of the sensitivity of policy effects to assumptions on external drivers. Two key modelling approaches applied for policy impact analysis include structural models and econometric models, with the former dominating the latter mainly due to its better adaptability to the needs of policy makers. However, with the CAP evolving towards ever more complex instruments, the relevance and predictive accuracy of structural models will possibly improve only as long as methodological and data issues are addressed. [Copyright &y& Elsevier]

Abstract: Regional convergence is one of the major goals of the European Union. In this paper, the intention is to address the question of whether, during the period 1995–2004 the NUTS-2 regions of EU-27 exhibited a tendency to converge in terms of agricultural labour productivity. A low annual rate of absolute convergence is estimated for the NUTS-2 regions over the period 1995–2004. The rate of regional convergence exhibits a considerable variation across different territorial divisions of the European Union. The implications of these results are discussed in the context of the Common Agricultural Policy and respective recommendations are issued. [Copyright &y& Elsevier]

Abstract: Within only two decades olive oil developed from a niche product which could hardly be found in food stores outside the producing regions towards an integrated component in the diets of industrial countries. This paper discusses the impacts of the promotion of the “healthy Mediterranean diet” on land use and agro-ecosystems in the producing countries. It examines the dynamics of olive oil production, trade and consumption in the EU15 in the period 1972–2003 and the links between dietary patterns, trade and land use. It analyses the underlying socio-economic driving forces behind the increasing spatial disconnect between production and consumption of olive oil in the EU15 and in particular in Spain, the world largest producer during the last three decades. In the observed period olive oil consumption increased 16-fold in the non-producing EU15 countries. In the geographically limited producing regions like Spain, the fivefold increase in export production was associated with the rapid industrialization of olive production, the conversion of vast Mediterranean landscapes to olive monocultures and a range of environmental pressures. High amounts of subsidies of the European Common Agricultural Policy and feedback loops within production and consumption systems were driving the transformation of the olive oil system. Our analysis indicates the process of change was not immediately driven by increases in demand for olive oil in non-producing countries, but rather by the institutional setting of the European Union and by concerted political interventions. [ABSTRACT FROM AUTHOR]

Abstract: The 2003 reform of the European Union Common Agricultural Policy (CAP) introduced Single Farm Payments (SFPs) which are decoupled payments conditional on cross-compliance, and allows these payments to be claimed for land kept fully idle but maintained in good agricultural and environmental conditions (GAEC). This paper focuses on the potential impact of the reform on land idling decisions in France with the help of a survey of the intentions of landowners. Both operator and non-operator landowners were considered since, although SFP entitlements are owned only by operator landowners in France, non-operator landowners may now have a higher incentive to switch to operating land by idling land and maintaining it under GAEC in order to claim SFPs. The key variables in landowners’ decisions to idle land in GAEC appear to be both monetary and non-monetary. Despite the likely difference in conversion and cross-compliance costs, operators and non-operators were shown to be equally uninterested in GAEC, suggesting that no dramatic changes in terms of idling land should occur in France as a result of the 2003 reform. [Copyright &y& Elsevier]

• We find the optimal land allocation among agriculture, land abandonment and forest • The societal values of socio-environmental public goods are taken into account • Carbon sequestration value drives results • Optimal land allocation entails a reduction in land abandonment and increase in forest Land abandonment is affecting several areas of Europe, and the issue has since some years become a policy objective. The consequences of land abandonment are however difficult to assess as both agriculture and land abandonment are linked to socio-environmental public goods, but the relationship between public good provision and land use, as well as their societal value, are unclear and debated. Policy such as the Common Agricultural Policy affects land abandonment and public good provision in different ways, by providing income support and targeting the provision of environmental public goods.The objective of the paper is to assess the land use, public good levels and welfare deriving from agricultural production and from the provision of three selected PGs, in three alternative scenarios. In a reference scenario land use allocation is driven by the maximization of agricultural income; we then compare these results with a scenario where land use decisions maximize the societal welfare, hence including the value generated by the three, and with a scenario that simulates Measure 13 of the Rural Development Programme (payment for Areas Facing natural or other specific Constraints). The method used is a land allocation model calibrated for the hill and mountain area of the province of Bologna (Italy), in which the public goods societal values are the results of a choice experiments taken in the Emilia-Romagna region. The main results is that the societal optimum is reached through a substantial change in land allocation (e.g. a strong reduction in land abandonment and an increase in forest areas) and in the composition of the welfare (from private agricultural income toward public good benefits) with respect to the private optimum. Moreover, generic income support reduces land abandonment but also total welfare as it has negative effects through the reduction of carbon sequestration and increase in soil erosion. More targeted policies, that more explicitly connect support to public good provision, have better welfare effects. [ABSTRACT FROM AUTHOR]