Is economic institutional adaptation feasible for agri-environmental policy? Case of Good Agricultural and Environmental Condition standards

This review focuses on Czech implementation of standards for soil and water protection called Good Agricultural and Environmental Conditions (GAEC), with linkage to the European Union (EU) level. I investigate different elements of adaptive institutional economics: (i) summarise current knowledge regarding the social reasons for introducing GAEC; (ii) assess the evidence linked to GAEC to better understand the potential as well as boundaries of formalizing cause-effect links; (iii) clarify the pertinence of producers' claims on costs accruing from GAEC implementation. These three points highlight the thesis of this paper: implementation in farmers' practices of the theoretical concept of sustainability in terms of bridging together economics, society and the environment. The economic reasoning for GAEC introduction within adaptive institutional economics stems from the relational positioning of the knowledge of the costs of the impact of agricultural land use on other characteristic rural land uses. GAEC are needed, albeit the size of support obtained by producers surpasses the costs of complying; therefore, the result pays off for farms. We have learned that GAEC implementation is important from regional to EU levels and that its role is more related to economic institutional adaptation than to regulation. Adaptation of institutional economics is therefore feasible, making it possible to understand GAEC as a network which manages and enables knowledge transfer linked directly to regulation. Institutional economics can link sustainability with farmers' practices and accounts for the behaviour of the farmers. In this review, I find that, for society, it is necessary to require measurement of agri-environmental outcomes for water resources, soil and biodiversity through GAEC at appropriate scales. These scales are likely to be relevant to adaptive institutional economy localities perceived by the rural public.