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Policy Measures for Ecosystem Services: a first survey of the impact of "Floor and Trade" mechanism at farm level in Veneto


  • Longhitano, Davide
  • Povellato, Andrea


In the ongoing debate of CAP reform, a new tool was proposed for farms that aims to create a new market for ecosystem goods and services that may be provided by agriculture. The mechanism of floor and trade (FT) assigns each holding a "minimum of environmental goods" that must be provided at farm level to ensure sustainability and justifies the subsides received from CAP. In this proposal we will analyse what might happen in a limited region (Veneto) with the application of FT mechanism, given the geographical conditions and the structural situation of farms, using FADN data. More precisely, we seek to quantify the regional supply curve of environmental services, provided by agricultural activities in case of floor and trade mechanism. We will use as a proxy the amount of carbon that could be sequestered by less intensive farming systems such as grassland and pastures, compared with other more intensive activities, in order to examine the trade-off between the economic goals of farmers and the environmental benefits due to the land use change provided by FT. We will use as methodology the Minimum Data (MD) approach in order to integrate the spatial heterogeneity of the biophysical environment of the different agroecosystems, with economic behaviour of farmers in case of the obligations imposed by the FT mechanism

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  • Longhitano, Davide & Povellato, Andrea, 2011. "Policy Measures for Ecosystem Services: a first survey of the impact of "Floor and Trade" mechanism at farm level in Veneto," 122nd Seminar, February 17-18, 2011, Ancona, Italy 100040, European Association of Agricultural Economists.
  • Handle: RePEc:ags:eaa122:100040

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    References listed on IDEAS

    1. Biorn, Erik, 2004. "Regression systems for unbalanced panel data: a stepwise maximum likelihood procedure," Journal of Econometrics, Elsevier, vol. 122(2), pages 281-291, October.
    2. Zohra Bouamra-Mechemache & Roel Jongeneel & Vincent Réquillart, 2008. "Impact of a gradual increase in milk quotas on the EU dairy sector," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 35(4), pages 461-491, December.
    3. Silke Hüttel & Oliver Mußhoff & Martin Odening, 2010. "Investment reluctance: irreversibility or imperfect capital markets?," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 37(1), pages 51-76, March.
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    More about this item


    Floor and trade; Ecosystems service; FADN; Agricultural and Food Policy; Q-57;

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