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Agri-environmental contracting of Dutch dairy farms: the role of manure policies and the occurrence of lock-in

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  • Jack Peerlings
  • Nico Polman

Abstract

The paper examines the possibility of lock-in on the area contracted under an agri-environmental contract in Dutch dairy farming, using a mathematical programming model, and the interaction of these contracts with Dutch national manure policy. Stricter manure policies increase contract participation, since more restrictive N application standards lower the opportunity cost of contracting. If contract payments are halved in a later period, 95 per cent of the contracting farms in the model would like to alter their contracting decision but they do not because of the cost of grassland renewal (switching cost). These farms are locked-in. The model incorporates time, transaction cost and technical and institutional constraints. Oxford University Press and Foundation for the European Review of Agricultural Economics 2008; all rights reserved. For permissions, please email journals.permissions@oxfordjournals.org, Oxford University Press.

Suggested Citation

  • Jack Peerlings & Nico Polman, 2008. "Agri-environmental contracting of Dutch dairy farms: the role of manure policies and the occurrence of lock-in," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 35(2), pages 167-191, June.
  • Handle: RePEc:oup:erevae:v:35:y:2008:i:2:p:167-191
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    File URL: http://hdl.handle.net/10.1093/erae/jbn022
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    Cited by:

    1. Zimmermann, Andrea & Britz, Wolfgang, 2014. "European Farms’ Participation in Agri-environmental Measures," 2014 International Congress, August 26-29, 2014, Ljubljana, Slovenia 183073, European Association of Agricultural Economists.
    2. 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.
    3. 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.
    4. repec:eee:agisys:v:159:y:2018:i:c:p:111-125 is not listed on IDEAS
    5. Mettepenningen, E. & Beckmann, V. & Eggers, J., 2011. "Public transaction costs of agri-environmental schemes and their determinants--Analysing stakeholders' involvement and perceptions," Ecological Economics, Elsevier, vol. 70(4), pages 641-650, February.

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