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Economic and environmental impact of the CAP mid-term review on arable crop farming in South-western France

Author

Listed:
  • Charilaos Kephaliacos

    () (LEREPS - Laboratoire d'Etude et de Recherche sur l'Economie, les Politiques et les Systèmes Sociaux - UT1 - Université Toulouse 1 Capitole - UT2J - Université Toulouse - Jean Jaurès - Institut d'Études Politiques [IEP] - Toulouse - ENSFEA - École Nationale Supérieure de Formation de l'Enseignement Agricole de Toulouse-Auzeville)

  • Françoise Carpy-Goulard

    () (LEREPS - Laboratoire d'Etude et de Recherche sur l'Economie, les Politiques et les Systèmes Sociaux - UT1 - Université Toulouse 1 Capitole - UT2J - Université Toulouse - Jean Jaurès - Institut d'Études Politiques [IEP] - Toulouse - ENSFEA - École Nationale Supérieure de Formation de l'Enseignement Agricole de Toulouse-Auzeville, Agence de l'Eau Adour-Garonne)

  • Aude Ridier

    () (SMART - Structures et Marché Agricoles, Ressources et Territoires - AGROCAMPUS OUEST - Institut Agro - Institut national d'enseignement supérieur pour l'agriculture, l'alimentation et l'environnement - INRA - Institut National de la Recherche Agronomique)

  • Claire Mosnier

    ()

Abstract

The issue addressed in this paper is whether implementation of the CAP MTR, (involving decoupled payments reduced by "modulations" and subject to cross-compliance measures) can be effective in improving the environmental impact of arable farming. The focus is on two French cross-compliance measures (compulsory buffer strips along rivers and crop diversity). A farm-level bio-economic model incorporating yield uncertainty is built and adjusted to represent two typical arable farms in the Southwest of France. The model also combines agro-environmental indicators. The results indicate that a simple decoupling of direct payments, without cross-compliance measures, has no impact on allocations between different crops. If cross-compliance measures are imposed, a small reduction in the cultivated area of irrigated crops is observed. The penalty levied (1% of the total subsidy paid) when farmers do not comply with the "buffer strips" requirement is sufficient for both farm-types. Decoupling and modulation result in a fall in the total gross margin of around 3%, principally because of the 5% modulation rate, while the "buffer strips" requirement leads to a further decrease of around 1%. Moreover, this requirement improves the environmental indicators at the farm level.

Suggested Citation

  • Charilaos Kephaliacos & Françoise Carpy-Goulard & Aude Ridier & Claire Mosnier, 2009. "Economic and environmental impact of the CAP mid-term review on arable crop farming in South-western France," Post-Print halshs-00844542, HAL.
  • Handle: RePEc:hal:journl:halshs-00844542
    DOI: 10.1016/j.ecolecon.2008.10.001
    Note: View the original document on HAL open archive server: https://halshs.archives-ouvertes.fr/halshs-00844542
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    References listed on IDEAS

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    Cited by:

    1. Jacquet, Florence & Butault, Jean-Pierre & Guichard, Laurence, 2011. "An economic analysis of the possibility of reducing pesticides in French field crops," Ecological Economics, Elsevier, vol. 70(9), pages 1638-1648, July.
    2. Stefano Gaudino & Pytrik Reidsma & Argyris Kanellopoulos & Dario Sacco & Martin K. Van Ittersum, 2018. "Integrated Assessment of the EU’s Greening Reform and Feed Self-Sufficiency Scenarios on Dairy Farms in Piemonte, Italy," Agriculture, MDPI, Open Access Journal, vol. 8(9), pages 1-27, September.
    3. Esther Boere & G. Cornelis van Kooten, 2015. "Reforming the Common Agricultural Policy: Decoupling Agricultural Payments from Production and Promoting the Environment," Working Papers 2015-01, University of Victoria, Department of Economics, Resource Economics and Policy Analysis Research Group.
    4. Jaraite, Jurate & Kažukauskas, Andrius, 2011. "The effect of mandatory agro-environmental policy on farm environmental performance," CERE Working Papers 2011:13, CERE - the Center for Environmental and Resource Economics.
    5. Mosnier, Claire & Duclos, Anne & Agabriel, Jacques & Gac, Armelle, 2017. "Orfee: A bio-economic model to simulate integrated and intensive management of mixed crop-livestock farms and their greenhouse gas emissions," Agricultural Systems, Elsevier, vol. 157(C), pages 202-215.
    6. Ricome, Aymeric & Chaib, Karim & Ridier, Aude & Kephaliacos, Charilaos & Carpy-Goulard, Francoise, 2012. "The role of cash crop marketing contracts in the adoption of low-input practices in the presence of risk and income supports," 126th Seminar, June 27-29, 2012, Capri, Italy 126222, European Association of Agricultural Economists.
    7. Sauer, Johannes & Walsh, John & Zilberman, David, 2012. "Behavioural Change through Agri-Environmental Policies ? – A Distance Function based Matching Approach," 86th Annual Conference, April 16-18, 2012, Warwick University, Coventry, UK 134783, Agricultural Economics Society.
    8. Aude Ridier & Charilaos Kephaliacos & Francoise Carpy-Goulard, 2011. "Private transaction costs and environmental cross compliance in a crop region of Southwestern France," International Journal of Agricultural Resources, Governance and Ecology, Inderscience Enterprises Ltd, vol. 9(1/2), pages 68-79.
    9. Homolka, Jaroslav & Svecova, Michaela, 2012. "Analysis of financial support influences on management of agricultural enterprises," AGRIS on-line Papers in Economics and Informatics, Czech University of Life Sciences Prague, Faculty of Economics and Management, vol. 4(1), pages 1-8, March.
    10. Sauer, J. & Walsh, J. & Zilberman, D., 2014. "Agri-Environmental Policy Effects at Producer Level – Identification and Measurement," Proceedings “Schriften der Gesellschaft für Wirtschafts- und Sozialwissenschaften des Landbaues e.V.”, German Association of Agricultural Economists (GEWISOLA), vol. 49, March.
    11. Lelyon, Baptiste & Chatelier, Vincent & Daniel, Karine, 2011. "Decoupling and prices: determinant of dairy farmers’ choices?," Review of Agricultural and Environmental Studies - Revue d'Etudes en Agriculture et Environnement (RAEStud), Institut National de la Recherche Agronomique (INRA), vol. 92(1).
    12. Chopin, Pierre & Doré, Thierry & Guindé, Loïc & Blazy, Jean-Marc, 2015. "MOSAICA: A multi-scale bioeconomic model for the design and ex ante assessment of cropping system mosaics," Agricultural Systems, Elsevier, vol. 140(C), pages 26-39.
    13. Mosnier, C. & Agabriel, J. & Lherm, M. & Reynaud, A., 2009. "A dynamic bio-economic model to simulate optimal adjustments of suckler cow farm management to production and market shocks in France," Agricultural Systems, Elsevier, vol. 102(1-3), pages 77-88, October.
    14. Sauer, Johannes & Walsh, John & Zilberman, David, 2013. "Agri-Environmental Policy Effects at Producer Level - Identification and Measurement," 53rd Annual Conference, Berlin, Germany, September 25-27, 2013 156099, German Association of Agricultural Economists (GEWISOLA).
    15. Baptiste Lelyon & Vincent Chatellier & Karine Daniel, 2011. "Decoupling and prices: determinant of dairy farmers’ choices? [Découplage et prix : les déterminants du choix des éleveurs laitiers ?]," Post-Print hal-02641921, HAL.
    16. Petsakos, Athanasios & Jayet, Pierre-Alain, 2010. "Evaluating the efficiency of a N-input tax under different policy scenarios at different scales," 120th Seminar, September 2-4, 2010, Chania, Crete 109397, European Association of Agricultural Economists.
    17. Sauer, Johannes & Walsh, John & Zilberman, David, 2012. "Producer Behaviour and Agri-Environmental Policies: A Directional Distance based Matching Approach," 2012 Annual Meeting, August 12-14, 2012, Seattle, Washington 124877, Agricultural and Applied Economics Association.

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