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Evaluating the effects of farm programmes: results from propensity score matching

  • Andrea Pufahl
  • Christoph R. Weiss

The paper applies a semi-parametric propensity score matching approach to evaluate the effects of agri-environment (AE) programmes on input use and farm output of individual farms in Germany. The analysis reveals a positive and significant treatment effect of AE programmes on the area under cultivation, in particular grassland, resulting in a decrease of cattle livestock densities. Furthermore, participation significantly reduced the purchase of farm chemicals (fertiliser, pesticide). We also find differences in the treatment effect among individual farms (heterogeneous treatment effects). Farms that can generate the largest benefit from the programme are most likely to participate. Oxford University Press and Foundation for the European Review of Agricultural Economics 2009; all rights reserved. For permissions, please email journals.permissions@oxfordjournals.org, Oxford University Press.

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File URL: http://hdl.handle.net/10.1093/erae/jbp001
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Article provided by Foundation for the European Review of Agricultural Economics in its journal European Review of Agricultural Economics.

Volume (Year): 36 (2009)
Issue (Month): 1 (March)
Pages: 79-101

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Handle: RePEc:oup:erevae:v:36:y:2009:i:1:p:79-101
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  1. Nigel Key & Michael J. Roberts, 2006. "Government Payments and Farm Business Survival," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 88(2), pages 382-392.
  2. A. Smith, Jeffrey & E. Todd, Petra, 2005. "Does matching overcome LaLonde's critique of nonexperimental estimators?," Journal of Econometrics, Elsevier, vol. 125(1-2), pages 305-353.
  3. C. S. Kim & G. Schluter & G. Schaible & A. Mishra & C. Hallahan, 2005. "A Decomposed Negative Binomial Model of Structural Change: A Theoretical and Empirical Application to U.S. Agriculture," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 53(2-3), pages 161-176, 06.
  4. Barbara Sianesi, 2001. "Propensity score matching," United Kingdom Stata Users' Group Meetings 2001 12, Stata Users Group, revised 23 Aug 2001.
  5. Mary Clare Ahearn & Jet Yee & Penni Korb, 2005. "Effects of Differing Farm Policies on Farm Structure and Dynamics," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 87(5), pages 1182-1189.
  6. Lori Lynch & Wayne Gray & Jacqueline Geoghegan, 2007. "Are Farmland Preservation Program Easement Restrictions Capitalized into Farmland Prices? What Can a Propensity Score Matching Analysis Tell Us? ," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 29(3), pages 502-509.
  7. Rajeev H. Dehejia & Sadek Wahba, 1998. "Causal Effects in Non-Experimental Studies: Re-Evaluating the Evaluation of Training Programs," NBER Working Papers 6586, National Bureau of Economic Research, Inc.
  8. Sascha O. Becker & Andrea Ichino, 2002. "Estimation of average treatment effects based on propensity scores," Stata Journal, StataCorp LP, vol. 2(4), pages 358-377, November.
  9. Nigel Key & Ruben N. Lubowski & Michael J. Roberts, 2005. "Farm-Level Production Effects from Participation in Government Commodity Programs: Did the 1996 Federal Agricultural Improvement and Reform Act Make a Difference?," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 87(5), pages 1211-1219.
  10. Heckman, James J. & Lalonde, Robert J. & Smith, Jeffrey A., 1999. "The economics and econometrics of active labor market programs," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 31, pages 1865-2097 Elsevier.
  11. Caliendo, Marco & Kopeinig, Sabine, 2005. "Some Practical Guidance for the Implementation of Propensity Score Matching," IZA Discussion Papers 1588, Institute for the Study of Labor (IZA).
  12. Shaik, Saleem & Helmers, Glenn A., 2006. "An Examination Of Farm Program Payments On Farm Economic Structure," 2006 Annual meeting, July 23-26, Long Beach, CA 21215, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
  13. Michael Lechner, 2002. "Program Heterogeneity And Propensity Score Matching: An Application To The Evaluation Of Active Labor Market Policies," The Review of Economics and Statistics, MIT Press, vol. 84(2), pages 205-220, May.
  14. Joe Dewbre, 2006. "The Impact of Coupled and Decoupled Government Subsidies on Off-Farm Labor Participation of U.S. Farm Operators," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 88(2), pages 393-408.
  15. James J. Heckman & Hidehiko Ichimura & Petra Todd, 1998. "Matching As An Econometric Evaluation Estimator," Review of Economic Studies, Oxford University Press, vol. 65(2), pages 261-294.
  16. Thilo Glebe & Klaus Salhofer, 2007. "EU agri-environmental programs and the "restaurant table effect"," Agricultural Economics, International Association of Agricultural Economists, vol. 37(2-3), pages 211-218, 09.
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