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Joint production under uncertainty and multifunctionality of agriculture: policy considerations and applied analysis

Author

Listed:
  • Petr Havlík
  • Patrick Veysset
  • Jean-Marie Boisson
  • Michel Lherm
  • Florence Jacquet

Abstract

The impact of various policy instruments on the production of environmental goods that are complementary to or competing with agricultural commodities is analysed in the light of the uncertainty in output prices and farmers' risk aversion. Some theoretical assessments are first summarised and then tested on a case study concerning beef and grassland biodiversity production in Monts du Cantal, France. The results of simulations carried out by mathematical programming farm-level models show that joint commodity and non-commodity production is nearly independent of the degree of farmers' risk aversion, and that commodity-linked policy instruments are not suitable for the production of environmental goods even under uncertainty. Copyright 2005, Oxford University Press.

Suggested Citation

  • Petr Havlík & Patrick Veysset & Jean-Marie Boisson & Michel Lherm & Florence Jacquet, 2005. "Joint production under uncertainty and multifunctionality of agriculture: policy considerations and applied analysis," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 32(4), pages 489-515, December.
    • Handle: RePEc:oup:erevae:v:32:y:2005:i:4:p:489-515
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    Cited by:

    1. Petr Havlik & Geoffroy Enjolras & Jean-Marie Boisson & Florence Jacquet & Michel Lherm & Patrick Veysset, 2008. "Environmental good production in the optimum activities portfolio of a risk averse-farmer," Review of Agricultural and Environmental Studies - Revue d'Etudes en Agriculture et Environnement, INRA Department of Economics, vol. 86(1), pages 9-33.
    2. Luciano Pilati & Vasco Boatto, 2013. "Bio-Economics Of Allocatable Pollination Services: Sequential Choices And Jointness In Sites," DEM Discussion Papers 2013/18, Department of Economics and Management.
    3. Ricome, Aymeric & Chaib, Karim & Ridier, Aude & Kephaliacos, Charilaos & Carpy-Goulard, Francoise, 2016. "The Role of Marketing Contracts in the Adoption of Low-Input Production Practices in the Presence of Income Supports: An Application in Southwestern France," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 41(3), pages 1-29.
    4. Luciano Pilati & Mario Prestamburgo, 2016. "Sequential Relationship between Profitability and Sustainability: The Case of Migratory Beekeeping," Sustainability, MDPI, vol. 8(1), pages 1-8, January.
    5. Tomáš DOUCHA & Ivan Foltýn & Jaroslav HUMPÁL, 2012. "Profitability of dairy and suckler cows breeding on Czech farms," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 58(9), pages 397-408.
    6. Veysset, P. & Lherm, M. & Bébin, D., 2010. "Energy consumption, greenhouse gas emissions and economic performance assessments in French Charolais suckler cattle farms: Model-based analysis and forecasts," Agricultural Systems, Elsevier, vol. 103(1), pages 41-50, January.
    7. Dimitre Nikolov & Ivan Boevsky & Peter Borisov & Teodor Radev, 2016. "The Provision of Public Goods Through Agriculture and Forestry in South Central Region in Bulgaria," International Conference on Competitiveness of Agro-food and Environmental Economy Proceedings, The Bucharest University of Economic Studies, vol. 5, pages 23-34.
    8. Jacquet, Florence & Butault, Jean-Pierre & Guichard, Laurence, 2011. "An economic analysis of the possibility of reducing pesticides in French field crops," Ecological Economics, Elsevier, vol. 70(9), pages 1638-1648, July.
    9. Wossink, Ada & Swinton, Scott M., 2007. "Jointness in production and farmers' willingness to supply non-marketed ecosystem services," Ecological Economics, Elsevier, vol. 64(2), pages 297-304, December.
    10. Mosnier, Claire & Ridier, Aude & Kphaliacos, Charilaos & Carpy-Goulard, Françoise, 2009. "Economic and environmental impact of the CAP mid-term review on arable crop farming in South-western France," Ecological Economics, Elsevier, vol. 68(5), pages 1408-1416, March.
    11. Kleftodimos, Georgios & Gallai, Nicola & Rozakis, Stelios & Képhaliacos, Charilaos, 2021. "A farm-level ecological-economic approach of the inclusion of pollination services in arable crop farms," Land Use Policy, Elsevier, vol. 107(C).
    12. Luciano Pilati & Vasco Boatto, 2014. "Jointness in Sites: The Case of Migratory Beekeeping," DEM Discussion Papers 2014/10, Department of Economics and Management.
    13. Salau, S. & Omotesho, O. & Muhammad-Lawal, A., 2018. "Agricultural Commercialization, Fertilizer Use and Non-Farm Employment: What Options for Smallholder Farmers in Nigeria?," 2018 Conference, July 28-August 2, 2018, Vancouver, British Columbia 277180, International Association of Agricultural Economists.
    14. Frédéric Barraquand & Vincent Martinet, 2009. "Agricultural land-use and biological conservation," EconomiX Working Papers 2009-18, University of Paris Nanterre, EconomiX.
    15. Mouysset, L. & Doyen, L. & Jiguet, F. & Allaire, G. & Leger, F., 2011. "Bio economic modeling for a sustainable management of biodiversity in agricultural lands," Ecological Economics, Elsevier, vol. 70(4), pages 617-626, February.
    16. Lauriane MOUYSSET & Luc DOYEN & Fréderic JIGUET, 2012. "How does the economic risk aversion affect biodiversity?," Cahiers du GREThA (2007-2019) 2012-03, Groupe de Recherche en Economie Théorique et Appliquée (GREThA).
    17. Bamière, Laure & David, Maia & Vermont, Bruno, 2013. "Agri-environmental policies for biodiversity when the spatial pattern of the reserve matters," Ecological Economics, Elsevier, vol. 85(C), pages 97-104.
    18. Moon, Wanki & Chang, Jae Bong & Asirvatham, Jebaraj, 2016. "Identifying Factors Driving US Citizens’ Preferences about Multifunctional Agriculture," 2016 Annual Meeting, February 6-9, 2016, San Antonio, Texas 230032, Southern Agricultural Economics Association.
    19. Mosnier, Claire & Agabriel, Jacques & Lherm, Michel & Reynaud, Arnaud, 2008. "Assessing Economic And Technical Impacts Of Non Expected Weather Events On French Suckler Cow Farms Dynamics: A Dynamic Recursive Farm Model," 2008 International Congress, August 26-29, 2008, Ghent, Belgium 44257, European Association of Agricultural Economists.
    20. P. Havlík & F. Jacquet & J.M. Boisson & S. Hejduk & P. Veselý, 2006. "Mathematical programming models for agri-environmental policy analysis: A case study from the White Carpathians," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 52(2), pages 51-66.
    21. Bamiére, Laure & David, Maia & Vermont, Bruno, 2011. "Agri-Environmental Policies When the Spatial Pattern of Biodiversity Reserves Matters," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 114239, European Association of Agricultural Economists.
    22. Chen, You-hua & Chen, Mei-xia & Mishra, Ashok K., 2020. "Subsidies under uncertainty: Modeling of input- and output-oriented policies," Economic Modelling, Elsevier, vol. 85(C), pages 39-56.
    23. Bamière, Laure & Havlík, Petr & Jacquet, Florence & Lherm, Michel & Millet, Guy & Bretagnolle, Vincent, 2011. "Farming system modelling for agri-environmental policy design: The case of a spatially non-aggregated allocation of conservation measures," Ecological Economics, Elsevier, vol. 70(5), pages 891-899, March.
    24. Mosnier, C. & Agabriel, J. & Lherm, M. & Reynaud, A., 2009. "A dynamic bio-economic model to simulate optimal adjustments of suckler cow farm management to production and market shocks in France," Agricultural Systems, Elsevier, vol. 102(1-3), pages 77-88, October.
    25. Petr Havlik & Geoffroy Enjolras & Jean-Marie Boisson & Florence Jacquet & Michel Lherm & Patrick Veysset, 2008. "Environmental good production in the optimum activities portfolio of a risk averse-farmer," Review of Agricultural and Environmental Studies - Revue d'Etudes en Agriculture et Environnement, INRA Department of Economics, vol. 86(1), pages 9-33.

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