The Causal Effect of Crop Diversification Obligations on Crop Diversity: An EU-level Analysis

Zelda Brutti (), Marzia Freo () and Laura Serlenga ()
Additional contact information
Zelda Brutti: European Commission - JRC, https://joint-research-centre.ec.europa.eu/index_en
Marzia Freo: European Commission - JRC, https://joint-research-centre.ec.europa.eu/index_en
Laura Serlenga: University of Bari

No 2025-03, JRC Working Papers in Economics and Finance from Joint Research Centre, European Commission

Abstract: The Common Agricultural Policy (CAP) is a cornerstone policy of the European Union, increasingly focused on promoting environmentally sustainable practices. In 2014, the CAP introduced Greening payments and a crop diversification requirement to enhance soil resilience and mitigate ecosystem degradation. Despite its economic significance, the policy's effectiveness across the EU remains largely limited. This study evaluates the impact of the Greening crop diversification requirement on crop diversity itself and on a set of subsequent outcomes, including agricultural land allocation, the economic performance of farms and indirect environmental outcomes. Using farm-level data from the Farm Accountancy Data Network (2012-2017), causal relationships are identified, through a design that combines propensity score matching and difference-in-differences, by comparing farms needing to adapt to the new requirements to those who were already compliant. Additionally, a regression discontinuity design estimates local average treatment effects for 2017, thereby exploiting the diversification requirement’s threshold-based design. Both strategies corroborate the conclusion that Greening measures have significantly increased crop diversity across the EU; moreover, results for the remaining farm-level outcomes are consistent with adaptation responses to the new environmental requirements. Overall, the results highlight the policy’s effectiveness in promoting sustainable agriculture throughout the EU.

Keywords: Crop diversification; Greening payments; Common Agricultural Policy; FADN (search for similar items in EconPapers)
JEL-codes: Q12 Q18 Q51 Q57 Q58 (search for similar items in EconPapers)
Pages: 28 pages
Date: 2025-02
References: Add references at CitEc
Citations:

Downloads: (external link)
https://publications.jrc.ec.europa.eu/repository/handle/JRC141256

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:jrs:wpaper:202503

Access Statistics for this paper

More papers in JRC Working Papers in Economics and Finance from Joint Research Centre, European Commission Contact information at EDIRC.
Bibliographic data for series maintained by Peter Benczur ().