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Decentralisation of agri-environmental policy design

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  • François Bareille
  • Matteo Zavalloni

Abstract

We theoretically examine the gains of the decentralisation of agri-environmental policy design. We consider a model with homogeneous regions and joint production of local and global public goods from agriculture. Assuming that governments are characterised by different agency costs and knowledge of the PG values, we evaluate whether decentralisation is a suitable strategy to improve the efficiency of agri-environmental payments. We find that partial decentralisation always improves the welfare. We apply our theoretical model to the case of abandoned wetlands in Brittany. We find that national governments are the most suitable to design agri-environmental policies. Our results contribute to reflections on future Common Agricultural Policy.

Suggested Citation

  • François Bareille & Matteo Zavalloni, 2020. "Decentralisation of agri-environmental policy design," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 47(4), pages 1502-1530.
  • Handle: RePEc:oup:erevae:v:47:y:2020:i:4:p:1502-1530.
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    More about this item

    Keywords

    Common Agricultural Policy reform; environmental federalism; public goods;
    All these keywords.

    JEL classification:

    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy
    • Q28 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Government Policy
    • H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism

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