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The role of risk aversion and labor constraints in the adoption of low input practices supported by the CAP green payments in cash crop farms

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  • Ridier, Aude
  • Ben El Ghali, Mohamed
  • Nguyen, G.
  • Kephaliacos, Charilaos

Abstract

Since the late 1980s, many alternative practices have been proposed to European farmers to reduce pesticide and input use in general. These practices have been promoted by agro-environmental contracts signed between individual farmers and the European Union and by which farmers engage themselves in changing their practices. The adoption rate of these measures has remained very low in many European regions particularly in Southwestern France. This article aims at stressing the role played by risk attitude and labor constraint in farmers’ adoption decision. After presenting a static theoretical model which assesses the impact of labor constraints and risk attitude on the level of adoption of low input practices supported by agro-environmental contracts, the article proposes a numerical application based on a mathematical programming risk-model implemented on two typical crop farms in South-western France. Three kinds of contracts (no tillage, long rotation, lower pest treatments) are tested, two of them (long rotation and lower pest treatments) aiming at directly reducing input use. The results show that, despite the overall positive impact of alternative practices under contract on environment and farmers’ income, increased yield variability under positive risk aversion and larger labor requirements are actual barriers to adoption.

Suggested Citation

  • Ridier, Aude & Ben El Ghali, Mohamed & Nguyen, G. & Kephaliacos, Charilaos, 2013. "The role of risk aversion and labor constraints in the adoption of low input practices supported by the CAP green payments in cash crop farms," Review of Agricultural and Environmental Studies - Revue d'Etudes en Agriculture et Environnement (RAEStud), Institut National de la Recherche Agronomique (INRA), vol. 94(2).
    • Handle: RePEc:ags:frraes:196598
    DOI: 10.22004/ag.econ.196598
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    2. Mohamed Ghali & Maha Ben Jaballah & Nejla Ben Arfa & Annie Sigwalt, 2022. "Analysis of factors that influence adoption of agroecological practices in viticulture," Review of Agricultural, Food and Environmental Studies, Springer, vol. 103(3), pages 179-209, September.
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    6. Dupré, Marie & Blazy, Jean-Marc & Michels, Thierry & Le Gal, Pierre-Yves, 2021. "Supporting policymakers in designing agricultural policy instruments: A participatory approach with a regional bioeconomic model in La Réunion (France)," Land Use Policy, Elsevier, vol. 100(C).

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    More about this item

    Keywords

    Farm Management; Risk and Uncertainty;

    JEL classification:

    • C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis
    • C67 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Input-Output Models
    • Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy; Animal Welfare Policy
    • Q57 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Ecological Economics

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