Article

Evaluating greening farm policies: a structural model for assessing agri-environmental subsidies

Marita Laukkanen, and Céline Nauges

Abstract

This study uses a structural econometric model to evaluate the impacts of support from a European Union agri-environmental program designed to reduce nutrient pollution from agricultural land. Drawing on a representative sample of individual grain farms, we first quantify the effects of agri-environmental payments on farms’ decisions on land allocation and on fertilizer use. We then combine the predicted land allocation and fertilizer use with environmental production functions to quantify the impact on nutrient loading. Finally, we assess the monetary value of reduced nutrient pollution, drawing on a recent valuation study.

Keywords

Agri‐environmental programs; farm subsidies; structural models; panel data; policy evaluation; nutrient pollution; cost‐benefit analysis;

JEL codes

  • Q53: Air Pollution • Water Pollution • Noise • Hazardous Waste • Solid Waste • Recycling
  • Q58: Government Policy

Reference

Marita Laukkanen, and Céline Nauges, Evaluating greening farm policies: a structural model for assessing agri-environmental subsidies, Land Economics, vol. 90, n. 3, August 2014, pp. 458–481.

Published in

Land Economics, vol. 90, n. 3, August 2014, pp. 458–481