Comparing practice‐ and results‐based agri‐environmental schemes controlled by remote sensing: An application to olive groves in Spain

Anastasio J. Villanueva, Rubén Granado‐Díaz and Sergio Colombo

Journal of Agricultural Economics, 2024, vol. 75, issue 2, 524-545

Abstract: Farmers' preferences toward practice‐ and results‐based agri‐environmental schemes (AES) are analysed using a labelled choice experiment. The analysis focuses on schemes involving an innovative satellite‐based monitoring system, with different environmental objectives. Olive groves in southern Spain are used as a case study. Results show no statistically significant differences in farmers' willingness to accept (WTA) payment for participating in practice‐ versus results‐based AES when the scheme targets carbon sequestration. By contrast, farmers require a significantly higher WTA payment for results‐based AES when targeting biodiversity (using bird species as an indicator), mostly due to the uncertainties related to its provision and monitoring. WTA significantly increases with provision level and remote sensing monitoring, regardless of the type of scheme. Significant preference heterogeneity is observed, partly explained by farmers' attitudes toward risk and their beliefs about environmental service provision and monitoring capacity. The results suggest useful policy implications, including the potential of making use of joint provision of environmental services in the design of results‐based AES and accompanying them with uncertainty mitigating measures.

Date: 2024
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