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Evaluation of Agro-Environmental Policy through a Calibrated Simulation Farm Model

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  • Hansen, Kristiana
  • Frahan, Bruno Henry de

Abstract

This paper evaluates the production and income effects from the adoption of one popular agro-environmental measure, which concerns buffer strips along field edges, on a representative sample of crop farms in Belgium taken from the Farm Accountancy Data Network database. We represent the economic behaviour of each crop farm with a profit-maximisation programming model that embeds an estimated ex-ante flexible cost function. We calibrate the simulation model using the Positive Mathematical Programming approach. Accounting for farm and regional heterogeneity, simulation results show how crop farms may respond differently to incentives for the agroenvironmental measure. Results demonstrate that economic incentives can be an effective mechanism for encouraging uptake of agro-environmental measures and that impacts of agro-environmental measures can vary by farm and region, depending on agronomic conditions and the environmental potential for agro-environmental measure activity.

Suggested Citation

  • Hansen, Kristiana & Frahan, Bruno Henry de, 2011. "Evaluation of Agro-Environmental Policy through a Calibrated Simulation Farm Model," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 114577, European Association of Agricultural Economists.
  • Handle: RePEc:ags:eaae11:114577
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    References listed on IDEAS

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    3. Lionel Delvaux & Bruno Henry de Frahan & Pierre Dupraz & Dominique Vermersch, 1999. "Adoption d'une MAE et consentement à recevoir des agriculteurs en région wallone," Économie rurale, Programme National Persée, vol. 249(1), pages 71-81.
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    5. Barreiro-Hurlé, Jesús & Espinosa-Goded, Maria & Dupraz, Pierre, 2008. "Does Intensity Of Change Matter? Factors Affecting Adoption In Two Agri-Environmental Schemes," 107th Seminar, January 30-February 1, 2008, Sevilla, Spain 6458, European Association of Agricultural Economists.
    6. Hansen, Kristiana & Baudry, Alexandre & De Blander, Rembert & Frahan, Bruno Henry de & Polome, Philippe, 2009. "Estimating an Ex Ante Cost Function for Belgian Arable Crop Farms," 2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin 49477, Agricultural and Applied Economics Association.
    7. Bertoni, Danilo & Cavicchioli, Daniele & Pretolani, Roberto & Olper, Alessandro, 2008. "Agri-Environmental Measures Adoption: New Evidence From Lombardy Region," 109th Seminar, November 20-21, 2008, Viterbo, Italy 44848, European Association of Agricultural Economists.
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    10. Bruno Henry de Frahan & Alexandre Baudry & Rembert De Blander & Philippe Polomé & Richard Howitt, 2011. "Dairy farms without quotas in Belgium: estimation and simulation with a flexible cost function," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 38(4), pages 469-495, October.
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    14. Isabel Vanslembrouck & Guido Huylenbroeck & Wim Verbeke, 2002. "Determinants of the Willingness of Belgian Farmers to Participate in Agri-environmental Measures," Journal of Agricultural Economics, Wiley Blackwell, vol. 53(3), pages 489-511.
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    Keywords

    Agricultural and Food Policy; Environmental Economics and Policy;

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