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This paper focuses on the potential use of insurance as a climate change adaptation mechanism in agriculture. We analyse the attractiveness of a climate risk insurance scheme and the choices farmers face between adaptation via farm management practices and purchase of crop insurance in the market. A choice experiment is used to reveal Danish farmers preferences regarding an insurance contract where adoption of land management practices to improve soil sustainability is conditional for obtaining insurance cover in the market. Results indicate that in general arable farmers and farmers with low soil quality who have experienced crop damages in the past are more likely to purchase such conditional insurance. Farmers with good quality soils, who perceive that they have already adapted their practices to climatic risks and who have not experienced losses due to adverse climatic events in the past are less willing to purchase insurance. The paper contributes to the limited knowledge on preferences for climate risk related insurance in agricultural systems in general, and in Europe in particular. © 2019 The paper was prepared under EU Framework 7 project “Ecological Function and Biodiversity Indicators in European soils” (ECOFINDERS grant no. 264465 ). Furthermore, the paper has benefited from support from the PREAR project (No 652615) granted under the FACCE SURPLUS ERA-NET Cofund and funded by the Danish Innovation Fund .

Soil organic carbon (SOC)1 plays a crucial role in regulating the global carbon cycle and its feedbacks within the Earth system. Compelling evidence exists that soil carbon stocks have reduced in many regions of the world, with these reductions often associated with agriculture. In a Danish context, research also suggests that soil carbon stocks are declining. The scope of Payment for Ecosystem Service (PES) approaches to effectively and efficiently address climate regulation will depend on the spatial distribution of the carbon assimilation capacity, current land use, the value of avoided emissions and land owners' objectives and preferences in terms of participating in initiatives to increase SOC. We map the carbon sequestration potential under different scenarios, value the potential sequestered carbon in terms of marginal costs of using voluntary agreements with agricultural land managers and compare these to the marginal abatement costs curve used in Danish climate policy. The cost effectiveness of reduced tillage as a climate mitigation PES scheme critically depends on the current debate on the net effects of carbon sequestration in reduced tillage practices. Based on existing IPCC guidelines, we find that reduced tillage has considerable potential for contributing to a cost effective climate mitigation policy.

Costs and benefits of water restoration projects are not necessarily evenly spread out over the entire area affected by the project. The physical distribution of benefits is, therefore, an important parameter when conducting economic analyses of water restoration projects. Two particularly relevant spatial issues relate to 1) the location of the population relative to the location of the waterbody, and 2) the availability and characteristics of substitute water bodies. Based on a contingent valuation (CV) study of the demand for restoring Odense River in Denmark a spatial demand model which accounts for travel time both to the river subject for valuation and to potential substitute sites is estimated. It is concluded that the spatial distribution of benefits is unlikely to be homogeneously determined by a one-dimensional spatial model. Moreover, the results suggest that the effect of spatial issues on preferences varies between users and non-users. For non-users the spatial impacts from potential substitutes significantly reduce demand for improvements in Odense River. This indicates that focus on estimation of distance decay effects may be an important tool in relation to ensuring proper geographical delimitation of the population in a given context.

One of the main contributors to anthropogenic climate change is agriculture, although, paradoxically, the sector is also very vulnerable to climate change effects, in particular extreme weather events. The agricultural sector can however make a significant contribution to climate change mitigation through increasing or sustaining soil carbon levels. The perception and action of farmers to anticipated climate change may be a significant determinant of both climate change impacts and mitigation efforts in agriculture. This is the first national-scale study of the perception of climate change by farmers and their associated farming practices regarding mitigation and adaptation. We find that Danish farmers realise that climate change will affect them in the future, and that many are already affected and are taking action to prevent future losses. Almost one fourth of the farmers surveyed stated that they include climate change mitigation in soil management planning. The majority of Danish farmers are already adapting to the effects of climate change, especially through maintaining or expanding drainage areas to reduce the impact of heavy rain, but also by changing soil management practices to increase water infiltration capacity. The study reveals the paradoxical finding that farmers, although believing that climate change is real, and having experienced losses due to adverse climatic events, do not tend to connect the two phenomena. Also there seems to be no link between perceptions of climate change and adaptation/mitigation action. Knowledge gained from this study can be useful for future policymaking on the effect of farm management practices in relation to climate change. Acknowledging farmers’ attitudes and beliefs may be an important component in understanding the responsiveness of the agricultural sector to initiatives to reduce emissions from farming and to improve the robustness of agricultural systems to climate change.

International audience; This paper provides a framework to understand the source of the economic value of soil biodiversity and soil ecosystem services and maps out the pathways of such values. We clarify the link between components of the economic value of soil biodiversity and their associated services of particular relevance to soils. We contend that soil biodiversity and associated ecosystem services give rise to two main additive value components in the context of risk and uncertainty: an output value and an insurance value. These are illustrated with examples from soil ecology and a simple heuristic model. The paper also points towards the challenges of capturing such values highlighting the differences between private (individual) and public (global) sources of value.