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Intervention in Agricultural Systems that Provide Positive Environmental Externalities: an Evaluation of Alternative Instruments

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  • Atance Muniz, Ignacio
  • Bardaji, Isabel
  • Tio, Carlos

Abstract

The Common Agricultural Policy (CAP) intervenes in most agricultural systems that provide positive environmental externalities using both direct payments and agrienvironmental schemes. In this context, the objective of this paper is to compare the efficiency of the current intervention system versus intervening using agri-environmental payments as a sole instrument. The cereal steppes agroecosystem of Tierra de Campos (Valladolid, Spain) has been selected to develop this comparison. A farm survey and a Positive Mathematical Programming Model have been combined to provide results of both alternative instruments. The farm survey was used to ask the farmers their payments demands to participate in the alternative instrument, supplying also qualitative information about how it is perceived by farmers. The payments demanded were simulated in the model to get environmental and economic indicators for both instruments. Instruments were evaluated using a cost-effectiveness approach were total public expenditure was conserved constant for both. The main conclusion of this research is that policy intervention effectiveness could be potentially increased using an agri-environmental scheme as the unique intervention instrument. Considering this finding, results transferability to other agricultural systems and policy consequences in the context of the CAP are finally discussed.

Suggested Citation

  • Atance Muniz, Ignacio & Bardaji, Isabel & Tio, Carlos, 2002. "Intervention in Agricultural Systems that Provide Positive Environmental Externalities: an Evaluation of Alternative Instruments," 2002 International Congress, August 28-31, 2002, Zaragoza, Spain 24810, European Association of Agricultural Economists.
    • Handle: RePEc:ags:eaae02:24810
    DOI: 10.22004/ag.econ.24810
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    1. Katrin Oltmer & Peter Nijkamp & Raymond Florax & Floor Brouwer, 2000. "A Meta-Analysis of Environmental Impacts of Agri-Environmental Policies in the European Union," Tinbergen Institute Discussion Papers 00-083/3, Tinbergen Institute.
    2. Martin Whitby & Caroline Saunders, 1996. "Estimating the Supply of Conservation Goods in Britain: A Comparison of the Financial Efficiency of Two Policy Instruments," Land Economics, University of Wisconsin Press, vol. 72(3), pages 313-325.
    3. Nick Hanley & Hilary Kirkpatrick & David Oglethorpe & Ian Simpson, 1998. "Principles for the provision of public goods from agriculture: modelling moorland conservation in Scotland," Chapters, in: John M. Antle & Joseph N. Lekakis & George P. Zanias (ed.), Agriculture, Trade and the Environment, chapter 8, pages 154-169, Edward Elgar Publishing.
    4. Kline, Jeffrey & Wichelns, Dennis, 1996. "Measuring Public Preferences for the Environmental Amenities Provided by Farmland," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 23(4), pages 421-436.
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    Cited by:

    1. Hartell, Jason G., 2004. "Pricing Benefit Externalities of Soil Carbon Sequestration in Multifunctional Agriculture," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 36(2), pages 1-15, August.

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