Assessing the impacts of agricultural support policies on the environment: Economic analysis, literature findings and synthesis

This report provides a comprehensive synthesis of existing knowledge on the impacts of agricultural producer support across environmental domains – air, soil, climate, water and biodiversity. Findings are used to draw a typology, consistent with the OECD framework for measuring agricultural support, that characterises the level of environmental risk or potential benefit associated with each form of support. The most production-coupled forms of support appear to be the most likely to generate environmentally harmful impacts, although these impacts vary depending on the type of production or input being targeted, and possible environmental conditions attached to the support. In contrast, agri-environmental payments, and more particularly performance – or results-based payments directly tied to environmental outcomes – are the most likely to be environmentally beneficial. Local conditions, trade-offs between environmental dimensions and scales of analysis of the impacts (domestic or global level) need to be considered for a complete determination of the impacts of support instruments.