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Measuring private transaction costs of European agri-environmental schemes


  • Evy Mettepenningen
  • Ann Verspecht
  • Guido Van Huylenbroeck


Recent changes in European agri-environmental policy allow farmers' transaction costs (TCs), also called private TCs, to be taken into account when calculating compensation payments for agri-environmental schemes (AESs). This gives rise to questions as to the significance of these costs and the methodologies used to measure them. In this paper, private TCs are measured and analysed using two methodologies: (1) through a survey of general perceptions of TCs and (2) through a one-year registration system for monitoring labour hours, operational and administrative costs and differences in revenue between a parcel of land in an AES and a comparable area of land not in a comparable scheme. The results obtained with both methodologies show that private TCs are significant and not to be underestimated. They represent about 15% of the total AES-related costs and about 25% of the compensation payment. The most important cost factor resulting from an AES-uptake is the income foregone which represents more than 50% of the total costs.

Suggested Citation

  • Evy Mettepenningen & Ann Verspecht & Guido Van Huylenbroeck, 2009. "Measuring private transaction costs of European agri-environmental schemes," Journal of Environmental Planning and Management, Taylor & Francis Journals, vol. 52(5), pages 649-667.
  • Handle: RePEc:taf:jenpmg:v:52:y:2009:i:5:p:649-667 DOI: 10.1080/09640560902958206

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    References listed on IDEAS

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    2. Latruffe, Laure & Piet, Laurent & Dupraz, Pierre & Mouël, Chantal Le, 2013. "The influence of agricultural support on sale prices of French farmland: A comparison of different subsidies, accounting for the role of environmental and land regulations," Proceedings Issues, 2013: Productivity and Its Impacts on Global Trade, June 2-4, 2013. Seville, Spain 152372, International Agricultural Trade Research Consortium.
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    13. Latruffe, Laure & Piet, Laurent & Dupraz, Pierre & Le Mouel, Chantal, 2014. "The influence of various agricultural subsidies on sale prices of French farmland," 2014 International Congress, August 26-29, 2014, Ljubljana, Slovenia 182749, European Association of Agricultural Economists.
    14. Weber, Anja Michaela, 2011. "Why do Farmers Spend Different Amounts of Transaction Costs in Agri-Environmental Schemes?," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 115738, European Association of Agricultural Economists.
    15. Coggan, Anthea & Whitten, Stuart M. & Bennett, Jeff, 2010. "Influences of transaction costs in environmental policy," Ecological Economics, Elsevier, vol. 69(9), pages 1777-1784, July.
    16. 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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    19. Huong, Tran Thi Thu & Zeller, Manfred & Hoanh, Chu Thai, 0. "The ‘Five Million Hectare Reforestation Program’ in Vietnam: An Analysis of its Implementation and Transaction Costs - A Case Study in Hoa Binh Province," Quarterly Journal of International Agriculture, Humboldt-Universität zu Berlin, vol. 53.
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    21. Eory, Vera, 2015. "Evaluating the use of marginal abatement cost curves applied to greenhouse gas abatement in agriculture," Working Papers 199777, Scotland's Rural College (formerly Scottish Agricultural College), Land Economy & Environment Research Group.
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