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Evaluating the effects of farm programs: Results from propensity score matching

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  • Andrea Pufahl

    (Federal Agricultural Research Center, Institute of Rural Studies, Braunschweig, Germany)

  • Christoph Weiss

    (Department of Economics, Vienna University of Economics & B.A.)

Abstract

The paper applies a non-parametric propensity score matching approach to evaluate the effects of two types of farm programs (agri-environment (AE) programs and the less favoured area (LFA) scheme) on input use and farm output of individual farms in Germany. The analysis reveals a positive and significant treatment effect of the LFA scheme for farm sales and the area under cultivation. Participants in AE schemes are found to significantly increase the area under cultivation (in particular grassland), resulting in a decrease of livestock densities. Furthermore, participation in AE programs significantly reduced the purchase of farm chemicals (fertilizer, pesticide). We also find substantial differences in the treatment effect between individual farms (heterogeneous treatment effects). Farms which can generate the largest benefit from the program are most likely to participate.

Suggested Citation

  • Andrea Pufahl & Christoph Weiss, 2007. "Evaluating the effects of farm programs: Results from propensity score matching," Department of Economics Working Papers wuwp113, Vienna University of Economics and Business, Department of Economics.
    • Handle: RePEc:wiw:wiwwuw:wuwp113
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    References listed on IDEAS

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    More about this item

    JEL classification:

    • Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy; Animal Welfare Policy
    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models

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