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Farm Level Costs of Agri-environment Measures: The Impact of Entry Level Stewardship on Cereal Farm Incomes

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  • Chihiro Udagawa
  • Ian Hodge
  • Mark Reader

Abstract

type="main" xml:id="jage12043-abs-0001"> Applying a difference-in-difference approach with propensity score matching, we examine the impact of participation in the Entry Level Stewardship (ELS) scheme on cereal farm incomes in eastern England. We assess the extent to which impacts are related to a) the source of income affected – whether only from agricultural or total business income; b) the channel of the impact – through land use and/or labour input; and c) the level of impacts through time. In addition, we assess the appropriateness of the level of the ELS payment. We find that: a) entering the ELS scheme could negatively affect cereal farm incomes – in particular, the total business income; b) that negative impacts arise primarily in relation to the use of land resources; c) that impacts may diminish over a relatively short period of time; and d) that the ELS payment broadly compensates for losses without providing over compensation. Given the diminishing negative impact over time, the level of ELS payment might need to be reviewed in the longer term, although policy evaluation should consider the wider implications for efficiency of alternative payment levels. We also discuss some limitations of the approach and potential extensions.

Suggested Citation

  • Chihiro Udagawa & Ian Hodge & Mark Reader, 2014. "Farm Level Costs of Agri-environment Measures: The Impact of Entry Level Stewardship on Cereal Farm Incomes," Journal of Agricultural Economics, Wiley Blackwell, vol. 65(1), pages 212-233, January.
  • Handle: RePEc:bla:jageco:v:65:y:2014:i:1:p:212-233
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    File URL: http://hdl.handle.net/10.1111/jage.2014.65.issue-1
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    1. Cisilino, Federica & Bodini, Antonella & Zanoli, Agostina, 2019. "Rural development programs’ impact on environment: An ex-post evaluation of organic faming," Land Use Policy, Elsevier, vol. 85(C), pages 454-462.
    2. Riccardo D’Alberto & Matteo Zavalloni & Meri Raggi & Davide Viaggi, 2018. "AES Impact Evaluation With Integrated Farm Data: Combining Statistical Matching and Propensity Score Matching," Sustainability, MDPI, vol. 10(11), pages 1-24, November.
    3. Laure Kuhfuss & Julie Subervie, 2015. "Do agri-environmental schemes help reduce herbicide use? Evidence from a natural experiment in France," Post-Print hal-01199067, HAL.
    4. Thapa, Bhawna & Chapagain, Binod P. & McMurry, Scott T. & Smith, Loren M. & Joshi, Omkar, 2024. "Understanding landowner participation in the Conservation Reserve Program in the U.S. High Plains region," Land Use Policy, Elsevier, vol. 141(C).
    5. Tzong-Haw Lee & Brian Lee & Yi-Ju Su & Hung-Hao Chang, 2022. "Green Payment Programs and Farmland Prices—An Empirical Investigation," Agriculture, MDPI, vol. 12(2), pages 1-11, February.
    6. Boris E. Bravo‐Ureta & Mario González‐Flores & William Greene & Daniel Solís, 2021. "Technology and Technical Efficiency Change: Evidence from a Difference in Differences Selectivity Corrected Stochastic Production Frontier Model," American Journal of Agricultural Economics, John Wiley & Sons, vol. 103(1), pages 362-385, January.
    7. Kuhfuss, Laure & Subervie, Julie, 2018. "Do European Agri-environment Measures Help Reduce Herbicide Use? Evidence From Viticulture in France," Ecological Economics, Elsevier, vol. 149(C), pages 202-211.
    8. Claire Jack & Adewale H. Adenuga & Austen Ashfield & Michael Wallace, 2020. "Investigating the Drivers of Farmers’ Engagement in a Participatory Extension Programme: The Case of Northern Ireland Business Development Groups," Sustainability, MDPI, vol. 12(11), pages 1-15, June.
    9. Arata, Linda & Hauschild, Sofia & Sckokai, Paolo, 2018. "Economic and social impact of grape growing in Northeastern Brazil," Bio-based and Applied Economics Journal, Italian Association of Agricultural and Applied Economics (AIEAA), vol. 6(3), May.
    10. Javier Castaño & Maria Blanco & Pilar Martinez, 2019. "Reviewing Counterfactual Analyses to Assess Impacts of EU Rural Development Programmes: What Lessons Can Be Learned from the 2007–2013 Ex-Post Evaluations?," Sustainability, MDPI, vol. 11(4), pages 1-22, February.
    11. Uehleke, Reinhard & Petrick, Martin & Hüttel, Silke, 2022. "Evaluations of agri-environmental schemes based on observational farm data: The importance of covariate selection," Land Use Policy, Elsevier, vol. 114(C).
    12. Ogawa, Keishi & Garrod, Guy & Yagi, Hironori, 2023. "Sustainability strategies and stakeholder management for upland farming," Land Use Policy, Elsevier, vol. 131(C).
    13. Arata, Linda & Hauschild, Sofia & Sckokai, Paolo, 2017. "Socio-economic impact of grape growing in North-eastern Brazil," 2017 Sixth AIEAA Conference, June 15-16, Piacenza, Italy 261264, Italian Association of Agricultural and Applied Economics (AIEAA).
    14. Ito, Junichi & Feuer, Hart N. & Kitano, Shinichi & Asahi, Haruka, 2019. "Assessing the effectiveness of Japan's community-based direct payment scheme for hilly and mountainous areas," Ecological Economics, Elsevier, vol. 160(C), pages 62-75.
    15. Adenuga, Adewale H. & Jack, Claire & Ashfield, Austen & Wallace, Michael, 2021. "Estimating the impact of membership of participatory extension programme across different enterprise groups: a conditional difference-in-differences approach," 95th Annual Conference, March 29-30, 2021, Warwick, UK (Hybrid) 311082, Agricultural Economics Society - AES.
    16. Laure Kuhfuss & Julie Subervie, 2015. "Do European PES help reduce herbicide use ? Evidence from a natural experiment in France," Working Papers 15-02, LAMETA, Universtiy of Montpellier, revised Nov 2015.
    17. Meike Weltin & Silke Hüttel, 2023. "Sustainable Intensification Farming as an Enabler for Farm Eco-Efficiency?," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 84(1), pages 315-342, January.
    18. Cristina SALVIONI & Dario SCIULLI, 2018. "Rural development policy in Italy: the impact of growth-oriented measures on farm outcomes," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 64(3), pages 115-130.
    19. Adewale H. Adenuga & Claire Jack & Austen Ashfield & Michael Wallace, 2021. "Assessing the Impact of Participatory Extension Programme Membership on Farm Business Performance in Northern Ireland," Agriculture, MDPI, vol. 11(10), pages 1-12, September.

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